What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-11-08 compared with 2024-08-07 · 321 added, 304 removed, 1288 unchanged (33% of the section changed)

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Throughout MD&A, all references to income or losses per share are on a diluted basis.

Any references to our website is for information only and the contents of our website or information connected thereto are not incorporated in, or otherwise to be regarded as part of, this Form 10-Q.

Any references to our website are for information only and the contents of our website or information connected thereto are not incorporated in, or otherwise to be regarded as part of, this Form 10-Q.

We are a leading international metals company with the objective of being foremost in copper.

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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.

We remain focused on execution of our operating plans, enhancing productivity, controlling costs and initiatives to build and advance optionality in our organic growth portfolio.

We continue to make progress on our leach innovation initiatives, with incremental copper production from these initiatives totaling 106 million pounds for the first six months of 2024, more than double amounts for the first six months of 2023.

We have a favorable long-term outlook for copper, supported by copper’s increasingly important role in the global economy and limited available supplies to meet growing demand.

During second-quarter 2024, PT Freeport Indonesia (PT-FI) began commissioning of its new copper smelter and is working to execute a safe and efficient ramp-up to full capacity by year-end 2024.

Additionally, construction continues on the adjoining precious metals refinery (PMR) with full production expected by year-end 2024.

Upon completion and full ramp-up of the new smelter and PMR (collectively, the new downstream processing facilities), PT-FI will be a fully integrated producer of refined copper and gold.

Our results for the second quarter and first six months of 2024 were impacted by previously announced shipping delays in Indonesia during June 2024 associated with the timing of renewing PT-FI’s copper concentrate and anode slimes export licenses, which expired on May 31, 2024.

On July 2, 2024, PT-FI was granted copper concentrate and anode slimes export licenses, which are valid through December 2024 when the full ramp-up of PT-FI’s new smelter is expected.

Net income attributable to common stockholders totaled $616 million in second-quarter 2024 and $1.1 billion for the first six months of 2024, compared with $343 million in second-quarter 2023 and $1.0 billion for the first six months of 2023.

The increase in the 2024 periods, compared to the 2023 periods, primarily reflects higher average realized prices on copper and gold sales, and lower interest expense as a result of interest charges in 2023 recognized for Cerro Verde’s contested tax rulings issued by the Peruvian Supreme Court (refer to Note 4), partly offset by increased operating costs, and higher income tax expense and income attributable to noncontrolling interests at our South America and Indonesia operations.

We remain focused on execution of our operating plans, while continuing to prioritize productivity and cost control, and advancing initiatives for long-term organic growth.

We continue to make progress on our leach innovation initiatives, with incremental copper production from these initiatives totaling 164 million pounds for the first nine months of 2024, compared with 97 million pounds for the first nine months of 2023.

We believe positive market fundamentals justify a favorable long-term outlook for copper, supported by copper’s increasingly important role in the global economy and limited available supplies to meet growing demand.

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%.

On October 14, 2024, a fire occurred during commissioning of PT Freeport Indonesia’s (PT-FI) new smelter in Gresik, Indonesia, following an equipment malfunction in the smelter furnace.

The fire resulted in damage to a gas cleaning facility (electrostatic precipitator plant) and infrastructure for the production of sulfuric acid.

There were no injuries.

While mining operations in Central Papua and the completion and ramp-up of the precious metals refinery (PMR) project have not been impacted, smelter start-up operations have been temporarily suspended pending remediation activities.

PT-FI is working with the Indonesia government to allow continued exports of copper concentrates until full ramp-up of the new smelter and PMR (collectively, PT-FI’s new downstream processing facilities) is achieved, including seeking an increase to the permitted quota for 2024.

Refer to “Operations – Indonesia” for additional discussion of the incident.

Net income attributable to common stockholders totaled $526 million in third-quarter 2024 and $1.6 billion for the first nine months of 2024, compared with $454 million in third-quarter 2023 and $1.5 billion for the first nine months of 2023.

The increases in the 2024 periods, compared to the 2023 periods, primarily reflect higher average realized copper and gold prices, higher gold sales volumes, and lower environmental obligations and shutdown costs, partly offset by higher operating costs, income tax expense and income attributable to noncontrolling interests.

Additionally, the first nine months of 2023 included interest expense recognized for Cerro Verde’s settlement of interest on a historical profit sharing liability and contested tax rulings issued by the Peruvian Supreme Court (refer to Note 4).

Refer to “Consolidated Results” for further discussion.

At June 30, 2024, we had consolidated debt of $9.4 billion and consolidated cash and cash equivalents of $5.3 billion, $6.2 billion including $0.9 billion of current restricted cash associated with a portion of PT-FI's export proceeds required to be temporarily deposited in Indonesia banks.

At September 30, 2024, we had consolidated debt of $9.7 billion and consolidated cash and cash equivalents of $5.0 billion, $6.0 billion including $1.0 billion of current restricted cash associated with a portion of PT-FI's export proceeds required to be temporarily deposited in Indonesia banks.

Net debt totaled $0.5 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 June 30, 2024, we had $3.0 billion of availability under our revolving credit facility, and PT-FI and Cerro Verde had $1.75 billion and $350 million, respectively, of availability under their revolving credit facilities.

At September 30, 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.

Refer to Note 4 and “Capital Resources and Liquidity” for further discussion of our debt balances and transactions.

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Following are our projected consolidated sales volumes for the year 2024:

Copper (billions of recoverable pounds):

Copper (millions of recoverable pounds):

North America copper mines 1,240

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Includes 50 million pounds produced by our North America copper mines and South America operations and 30 million pounds produced by our Molybdenum mines.

Consolidated sales volumes in third-quarter 2024 are expected to approximate 1.0 billion pounds of copper, 475 thousand ounces of gold and 20 million pounds of molybdenum.

Consolidated copper and gold production volumes for the year 2024 are expected to exceed 2024 sales volumes, reflecting the deferral of approximately 100 million pounds of copper and 120 thousand ounces of gold that will be processed by PT-FI’s new downstream processing facilities and sold as refined metal in 2025.

Consolidated sales volumes in fourth-quarter 2024 are expected to approximate 980 million pounds of copper, 340 thousand ounces of gold and 20 million pounds of molybdenum.

Consolidated copper and gold production volumes for the year 2024 are expected to exceed 2024 sales volumes, reflecting the deferral of approximately 85 million pounds of copper and 85 thousand ounces of gold associated with inventories held at PT-FI’s new downstream processing facilities that will be sold as refined metal in 2025.

Projected sales volumes are dependent on operational performance;

the timing of the ramp-up of PT-FI’s new smelter in Indonesia;

continuation of copper concentrate exports during the restoration period of PT-FI’s new smelter;

weather-related conditions;

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Consolidated Unit Net Cash Costs

Consolidated unit net cash costs (net of by-product credits) for our copper mines are expected to average $1.63 per pound of copper for the year 2024 (including $1.71 per pound of copper in third-quarter 2024), based on achievement of current sales volume and cost estimates, and assuming average prices of $2,300 per ounce of gold and $20.00 per pound of molybdenum for the second half of 2024.

Quarterly unit net cash costs vary with fluctuations in sales volumes and realized prices, primarily for gold and molybdenum.

The impact of price changes on consolidated unit net cash costs for the year 2024 would approximate $0.02 per pound of copper for each $100 per ounce change in the average price of gold and $0.01 per pound of copper for each $2 per pound change in the average price of molybdenum for the second half of 2024.

Consolidated unit net cash costs (net of by-product credits) for our copper mines are expected to average $1.58 per pound of copper for the year 2024 (including $1.72 per pound of copper in fourth-quarter 2024), based on achievement of current sales volume and cost estimates, and assuming average prices of $2,600 per ounce of gold and $20.00 per pound of molybdenum in fourth-quarter 2024.

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 during fourth-quarter 2024 on consolidated unit net cash costs for the year 2024 would approximate $0.01 per pound of copper for each $100 per ounce change in the average price of gold and $0.01 per pound of copper for each $2 per pound change in the average price of molybdenum.

Consolidated Operating Cash Flows

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and other factors.

Our consolidated operating cash flows are estimated to approximate $7.2 billion for the year 2024, based on current sales volume and cost estimates, and assuming average prices of $4.25 per pound of copper, $2,300 per ounce of gold and $20.00 per pound of molybdenum for the second half of 2024.

Our consolidated operating cash flows are estimated to approximate $6.8 billion for the year 2024, net of $0.4 billion of working capital and other uses, based on current sales volume and cost estimates, and assuming average prices of $4.25 per pound of copper, $2,600 per ounce of gold and $20.00 per pound of molybdenum in fourth-quarter 2024.

Estimated consolidated operating cash flows for the year 2024 also reflect an estimated income tax provision of $2.7 billion (refer to “Consolidated Results – Income Taxes” for further discussion of our projected income tax rate for the year 2024).

The impact of price changes for the second half of 2024 on consolidated operating cash flows would approximate $200 million for each $0.10 per pound change in the average price of copper, $80 million for each $100 per ounce change in the average price of gold and $50 million for each $2 per pound change in the average price of molybdenum.

The impact of price changes in fourth-quarter 2024 on consolidated operating cash flows would approximate $90 million for each $0.10 per pound change in the average price of copper, $30 million for each $100 per ounce

change in the average price of gold and $15 million for each $2 per pound change in the average price of molybdenum.

Consolidated Capital Expenditures

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PT-FI’s new downstream processing facilities 1.0 b

Primarily includes underground mine development, supporting mill and power capital costs in the Grasberg minerals district and expansion projects in North America.

Primarily includes underground mine development, supporting mill and power capital costs and initial spending on a new gas-fired combined cycle facility in the Grasberg minerals district, and expansion projects in North America.

Excludes capitalized interest and $0.3 billion of estimated commissioning and owner’s costs.

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The following graphs present the London Metal Exchange (LME) copper settlement price, the London Bullion Market Association (London) PM gold price, and the Platts Metals Daily Molybdenum Dealer Oxide weekly average price since January 2014.

This graph presents LME copper settlement prices and the combined reported stocks of copper at the LME, Commodity Exchange Inc., and the Shanghai Futures Exchange from January 2014 through June 2024.

During second-quarter 2024, LME copper settlement prices ranged from a low of $4.05 per pound to a record high of $4.92 per pound, averaged $4.42 per pound and settled at $4.30 per pound on June 28, 2024.

The decline in copper prices from the highs in May 2024, reflect market uncertainties in China.

The LME copper settlement price was $4.09 per pound on July 31, 2024.

This graph presents LME copper settlement prices and the combined reported stocks of copper at the LME, Commodity Exchange Inc., and the Shanghai Futures Exchange from January 2014 through September 2024.

During third-quarter 2024, LME copper settlement prices ranged from a low of $3.91 per pound to a high of $4.47

per pound, averaged $4.18 per pound and settled at $4.43 per pound on September 30, 2024.

Strong copper prices during third-quarter 2024 primarily resulted from investor sentiment and ongoing demand in China.

The LME copper settlement price was $4.28 per pound on October 31, 2024.

We believe fundamentals for copper are favorable with limited available supplies and 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 and growing connectivity globally.

This graph presents London PM gold prices from January 2014 through June 2024.

During second-quarter 2024, London PM gold prices ranged from a low of $2,265 per ounce to a record high of $2,427 per ounce, averaged $2,338 per ounce and closed at $2,331 per ounce on June 28, 2024.

Record high gold prices in second-quarter 2024 were propelled by U.S.

interest rate cut expectations and strong safe-haven demand.

The London PM gold price was $2,426 per ounce on July 31, 2024.

This graph presents the Platts Metals Daily Molybdenum Dealer Oxide weekly average price from January 2014 through June 2024.

During second-quarter 2024, the weekly average price of molybdenum ranged from a low of $19.57 per pound to a high of $23.52 per pound, averaged $21.78 per pound and was $22.74 per pound on June 28, 2024.

This graph presents London PM gold prices from January 2014 through September 2024.

During third-quarter 2024, London PM gold prices ranged from a low of $2,329 per ounce to a record high of $2,664 per ounce, averaged $2,474 per ounce and closed at $2,630 per ounce on September 30, 2024.

Economic uncertainty, geopolitical tensions and strong demand from central banks around the world during third-quarter 2024 continued to push gold prices to another quarterly record high.

The London PM gold price was $2,734 per ounce on October 31, 2024.

This graph presents the Platts Metals Daily Molybdenum Dealer Oxide weekly average price from January 2014 through September 2024.

During third-quarter 2024, the weekly average price of molybdenum ranged from a low of $20.83 per pound to a high of $23.06 per pound, averaged $21.77 per pound and was $21.59 per pound on September 30, 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 was $22.25 per pound on July 26, 2024.

The Platts Metals Daily Molybdenum Dealer Oxide weekly average price was $21.89 per pound on October 31, 2024.

CONSOLIDATED RESULTS

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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$ 1,199 $ 1,178 $ 3,569 $ 3,462

At September 30:

Cash and cash equivalents

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Restricted cash and cash equivalents, current g

$ 119 $ 1,030 g

$ 1,117 $ 697 $ 1,117 $ 697

Total debt, including current portion

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Refer to Note 8 for a summary of revenues and operating income by operating division.

Includes favorable (unfavorable) adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $166 million ($56 million to net income attributable to common stock) in second-quarter 2024, $(118) million ($(45) million to net income attributable to common stock) in second-quarter 2023, $28 million ($9 million to net income attributable

to common stock) for the first six months of 2024 and $182 million ($61 million to net income attributable to common stock) for the first six months of 2023.

Includes (unfavorable) favorable adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $(32) million ($(13) million to net income attributable to common stock) in third-quarter 2024, $4 million ($2 million to

net income attributable to common stock) in third-quarter 2023, $28 million ($9 million to net income attributable to common stock) for the first nine months of 2024 and $183 million ($62 million to net income attributable to common stock) for the first nine months of 2023.

Refer to Note 5 for further discussion.

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 $137 million ($41 million to net income attributable to common stock) in second-quarter 2024, $(39) million ($(21) million to net income attributable to common stock) in second-quarter 2023, $120 million ($36 million to net income attributable to common stock) for the first six months of 2024 and $72 million ($27 million to net income attributable to common stock) for the first six months of 2023.

Changes in these deferrals attributable to variability in intercompany volumes resulted in net (reductions) additions to operating income totaling $(42) million ($(13) million to net income attributable to common stock) in third-quarter 2024, $81 million ($37 million to net income attributable to common stock) in third-quarter 2023, $79 million ($23 million to net income attributable to common stock) for the first nine months of 2024 and $153 million ($64 million to net income attributable to common stock) for the first nine months of 2023.

Refer to “Operations – Smelting and Refining.”

Includes net charges totaling $51 million in second-quarter 2024 and $52 million for the first six months of 2024, primarily associated with revisions to environmental obligation estimates and related litigation reserves, and nonrecurring labor-contract charges at Cerro Verde.

The first six months of 2024 also include charges associated with assumed oil and gas abandonment obligations resulting from bankruptcies of other companies, offset by international tax credits.

Includes net charges totaling $157 million in second-quarter 2023 and $251 million for the first six months of 2023, primarily associated with charges for contested tax rulings issued by the Peruvian Supreme Court, environmental obligations, an accrual for a potential administrative fine in Indonesia, and impairments and contract-cancellation costs.

Working capital and other sources (uses) totaled $73 million in second-quarter 2024, $250 million in second-quarter 2023, $(24) million for the first six months of 2024 and $(202) million for the first six months of 2023.

Includes $0.9 billion at June 30, 2024, 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.

Three Months Ended June 30, Six Months Ended June 30,

Includes net charges totaling $30 million in third-quarter 2024 and $81 million for the first nine months of 2024, primarily associated with impairments for legacy oil and gas matters and nonrecurring labor-related charges at Cerro Verde, partly offset by a reduction in accruals for uncertain U.S.

tax positions.

The first nine months of 2024 also include charges associated with assumed oil and gas abandonment obligations resulting from bankruptcies of other companies, revisions to environmental obligation estimates and related litigation reserves, and inventory adjustments/write-offs, partly offset by international tax credits.

Includes net charges totaling $117 million in third-quarter 2023 and $368 million for the first nine months of 2023, primarily associated with revisions to environmental obligation estimates and related litigation reserves, and impairments for legacy oil and gas operations.

Net charges for the first nine months of 2023 also included charges for contested tax rulings issued by the Peruvian Supreme Court and an accrual for a potential administrative fine in Indonesia.

Working capital and other uses totaled $5 million in third-quarter 2024, $482 million in third-quarter 2023, $29 million for the first nine months of 2024 and $684 million for the first nine months of 2023.

Includes $1.0 billion at September 30, 2024, and $0.5 billion at September 30, 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.

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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Unit net cash costs per pound a

$ 1.73 $ 1.47 $ 1.61 $ 1.60

$ 1.73 $ 1.53 b

Gold (thousands of recoverable ounces)

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For reconciliations of per pound unit net cash costs (credits) by operating division to production and delivery costs applicable to sales reported in our consolidated financial statements, refer to “Product Revenues and Production Costs.”

Consolidated revenues totaled $6.6 billion in second-quarter 2024, $5.7 billion in second-quarter 2023, $12.9 billion for the first six months of 2024 and $11.1 billion for the first six months of 2023.

Includes $0.03 per pound of copper for both the third quarter and first nine months of 2024 for nonrecurring labor-related charges at Cerro Verde associated with new collective labor agreements.

Refer to “Operations – South America” for further discussion.

Consolidated revenues totaled $6.8 billion in third-quarter 2024, $5.8 billion in third-quarter 2023, $19.7 billion for the first nine months of 2024 and $17.0 billion for the first nine months of 2023.

Revenues from our mining operations and processing facilities primarily include the sale of copper cathode, copper in concentrate, copper rod, gold in concentrate and anode slimes, and molybdenum.

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Following is a summary of changes in our consolidated revenues between periods (in millions):

Three Months Ended June 30 Six Months Ended June 30

Three Months Ended September 30 Nine Months Ended September 30

Consolidated revenues - 2023 period $ 5,824 $ 16,950

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Copper (279) 404

Gold (262) 319

Molybdenum (27) 18

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Sales Volumes.

Consolidated sales volumes for the second quarter and first six months of 2024 were impacted by previously announced shipping delays in Indonesia associated with the timing of renewing PT-FI’s copper concentrate and anode slimes export licenses, which expired on May 31, 2024.

On July 2, 2024, PT-FI was granted copper concentrate and anode slimes export licenses, which are valid through December 2024 when the full ramp-up of PT-FI’s new smelter is expected.

The increase in consolidated copper and gold sales volumes for the first six months of 2024, compared to the first six months of 2023, primarily reflects higher mining and milling rates and ore grades at PT-FI.

Consolidated copper sales volumes decreased in third-quarter 2024, compared to third-quarter 2023, primarily as a result of the timing of shipments and lower ore grades and operating rates in North America.

Consolidated gold sales volumes increased in third-quarter 2024, compared to third-quarter 2023, primarily reflecting the timing of shipments in Indonesia.

Higher consolidated copper and gold sales volumes for the first nine months of 2024, compared to the 2023 period, primarily reflect higher mining and milling rates and copper ore grades at PT-FI, partly offset by lower operating rates in North America and South America.

Realized Prices.

Our consolidated revenues can vary significantly as a result of fluctuations in the market prices of copper, gold and molybdenum.

Average realized prices in second-quarter 2024, compared with second-quarter 2023, were 17% higher for copper, 18% higher for gold and 11% lower for molybdenum.

Average realized prices for the first six months of 2024, compared with the first six months of 2023, were 9% higher for copper, 15% higher for gold and 23% lower for molybdenum.

Average realized copper prices include net favorable (unfavorable) adjustments to current period provisionally priced copper sales totaling $15 million in second-quarter 2024, $(52) million in second-quarter 2023, $219 million for the first six months of 2024 and $(121) million for the first six months of 2023.

As discussed in Note 5, substantially 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).

We record revenues and invoice customers at the time of shipment based on then-current LME prices, which results in an embedded derivative on 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.

Average realized prices in third-quarter 2024, compared with third-quarter 2023, were 13% higher for copper, 35% higher for gold and 4% lower for molybdenum.

Average realized prices for the first nine months of 2024, compared with the first nine months of 2023, were 10% higher for copper, 22% higher for gold and 17% lower for molybdenum.

Average realized copper prices include net favorable (unfavorable) adjustments to current period provisionally priced copper sales totaling $61 million in third-quarter 2024, $(34) million in third-quarter 2023, $248 million for the first nine months of 2024 and $(152) million for the first nine months of 2023.

Average realized gold prices include net favorable (unfavorable) adjustments to current period provisionally priced gold sales totaling $74 million in third-quarter 2024, $(13) million in third-quarter 2023, $155 million for the first nine months of 2024 and $(8) million for the first nine months of 2023.

As discussed in Note 5, 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 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.

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.

Prior Period Provisionally Priced Copper Sales.

Net favorable (unfavorable) adjustments to prior periods’ provisionally priced copper sales ( i.e.

, provisionally priced sales at March 31, 2024 and 2023, and December 31, 2023 and 2022) recorded in consolidated revenues totaled $166 million in second-quarter 2024, $(118) million in second-quarter 2023, $28 million for the first six months of 2024 and $182 million for the first six months of 2023.

Net (unfavorable) favorable adjustments to prior periods’ provisionally priced copper sales ( i.e.

, provisionally priced sales at June 30, 2024 and 2023, and December 31, 2023 and 2022) recorded in consolidated revenues totaled $(32) million in third-quarter 2024, $4 million in third-quarter 2023, $28 million for the first nine months of 2024 and $183 million for the first nine months of 2023.

Refer to Notes 5 and 8 for a summary of total adjustments to prior period and current period provisionally priced sales.

At June 30, 2024, we had provisionally priced copper sales totaling 188 million pounds (net of intercompany sales and noncontrolling interests) recorded at an average of $4.33 per pound, subject to final pricing over the next several months.

We estimate that each $0.05 change in the price realized from the June 30, 2024, recorded

provisional price would have an approximate $18 million effect on 2024 revenues ($6 million to 2024 net income attributable to common stock).

The LME copper price settled at $4.09 per pound on July 31, 2024.

At September 30, 2024, we had provisionally priced copper sales totaling 162 million pounds (net of intercompany sales and noncontrolling interests) recorded at an average price of $4.43 per pound, subject to final pricing over the next several months.

We estimate that each $0.05 change in the price realized from the September 30, 2024, recorded provisional price would have an approximate $15 million effect on 2024 revenues ($5 million to 2024 net income attributable to common stock).

The LME copper price settled at $4.28 per pound on October 31, 2024.

Atlantic Copper Revenues.

Atlantic Copper revenues totaled $900 million in second-quarter 2024 and $1.6 billion for the first six months of 2024, compared with $748 million in second-quarter 2023 and $1.5 billion for the first six months of 2023.

Atlantic Copper revenues totaled $765 million in third-quarter 2024 and $2.3 billion for the first nine months of 2024, compared with $700 million in third-quarter 2023 and $2.2 billion for the first nine months of 2023.

Higher revenues in the 2024 periods, compared with the 2023 periods, primarily reflect higher copper prices and sales volumes.

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We purchase copper cathode primarily for processing by our Rod & Refining operations.

Higher revenues associated with purchased copper in second-quarter 2024, compared to second-quarter 2023, primarily reflects higher volumes.

The volumes of copper purchases vary depending on cathode production from our operations and totaled 64 million pounds in second-quarter 2024, 19 million pounds in second-quarter 2023, 106 million for the first six months of 2024 and 67 million for the first six months of 2023.

The volumes of copper purchases vary depending on cathode production from our operations and totaled 36 million pounds in third-quarter 2024, 18 million pounds in third-quarter 2023, 142 million pounds for the first nine months of 2024 and 85 million pounds for the first nine months of 2023.

Treatment Charges.

Revenues from our copper 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 the 2024 periods, compared to the 2023 periods, primarily reflects lower copper concentrate sales volumes because of previously announced shipping delays in Indonesia associated with the timing of renewing PT-FI’s copper concentrate export license.

The decrease in treatment charges in the 2024 periods, compared to the 2023 periods, primarily reflects lower copper concentrate sales volumes in South America.

Royalties and Export Duties.

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Royalties will vary with the volume of metal sold and the prices of copper and gold.

Indonesia export duties of 2.5% were eliminated effective March 29, 2023, upon verification that construction progress of the new smelter exceeded 50%, and were reinstated at a rate of 7.5% in July 2023 under a revised regulation.

As discussed in Note 7, PT-FI will continue to pay export duties of 7.5% on copper concentrates during the smelter ramp-up period pursuant to Indonesia regulations.

PT-FI incurred export duties totaling $75 million in second-quarter 2024, $231 million for the first six months of 2024 and $18 million for the first six months of 2023.

Export duties of 2.5% were eliminated effective March 29, 2023, upon verification that construction progress of the new smelter exceeded 50% and were reinstated at a rate of 7.5% in July 2023 under a revised regulation.

As discussed in Note 7, PT-FI is continuing to pay export duties of 7.5% on copper concentrates.

PT-FI incurred export duties totaling $129 million in third-quarter 2024, $147 million in third-quarter 2023, $360 million for the first nine months of 2024 and $165 million for the first nine months of 2023.

Production and Delivery Costs

Consolidated production and delivery costs totaled $3.9 billion in second-quarter 2024, $3.5 billion in second-quarter 2023, $7.7 billion for the first six months of 2024 and $6.7 billion for the first six months of 2023.

Higher costs in the 2024 periods, compared to the 2023 periods, primarily reflect higher costs of copper purchases at our downstream operations.

Additionally, the first six months of 2024 included higher operating rates at PT-FI and charges totaling $98 million associated with assumed oil and gas abandonment obligations resulting from bankruptcies of other companies (refer to Note 7 for further discussion).

Consolidated production and delivery costs totaled $4.1 billion in third-quarter 2024, $3.6 billion in third-quarter 2023, $11.8 billion for the first nine months of 2024 and $10.3 billion for the first nine months of 2023.

The 2024 periods include nonrecurring labor-related charges at Cerro Verde associated with new collective labor agreements (CLA) totaling $34 million in third-quarter 2024 and $99 million for the first nine months of 2024.

Additionally, the first nine months of 2024 included charges totaling $99 million associated with assumed oil and gas abandonment obligations resulting from bankruptcies of other companies (refer to Note 7 for further discussion).

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, explosives, steel, reagents, liners and tires.

Consolidated site production and delivery costs (before net noncash and other costs) for our copper mines averaged $2.56 per pound of copper in second-quarter 2024, $2.39 per pound of copper in second-quarter 2023, $2.43 per pound of copper for the first six months of 2024 and $2.47 per pound of copper for the first six months of 2023.

Consolidated site production and delivery costs (before net noncash and other costs) for our copper mines averaged $2.61 per pound of copper in third-quarter 2024, $2.27 per pound of copper in third-quarter 2023, $2.49 per pound of copper for the first nine months of 2024 and $2.40 per pound of copper for the first nine months of 2023.

Refer to “Operations – Unit Net Cash Costs” and “Operations – Unit Net Cash (Credits) Costs” 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.

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Depreciation will vary under the unit-of-production (UOP) method as a result of changes in sales volumes and the related UOP rates at our mining operations.

Consolidated depreciation, depletion and amortization (DD&A) totaled $509 million in second-quarter 2024, $547 million in second-quarter 2023, $1.1 billion for the first six months of 2024 and $0.9 billion for the first six months of 2023.

Consolidated depreciation, depletion and amortization (DD&A) totaled $600 million in third-quarter 2024, $533 million in third-quarter 2023, $1.7 billion for the first nine months of 2024 and $1.5 billion for the first nine months of 2023.

We currently expect that DD&A will approximate $2.3 billion for the year 2024.

Following completion of commissioning activities for PT-FI’s new downstream processing facilities, DD&A will include amounts associated with capitalized costs for the project.

Environmental Obligations and Shutdown Costs

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Shutdown costs include care-and-maintenance costs and any litigation, remediation or related expenditures associated with closed facilities or operations.

Net revisions to long-term historical environmental obligations totaled

$23 million in second-quarter 2024, $60 million in second-quarter 2023, $79 million for the first six months of 2024 and $116 million for the first six months of 2023.

Refer to Note 7 for further discussion.

Net revisions to long-term historical environmental obligations totaled $3 million in third-quarter 2024, $83 million in third-quarter 2023, $82 million for the first nine months of 2024 and $199 million for the first nine months of 2023.

Refer to Note 7.

Interest Expense, Net

Consolidated interest costs (before capitalization) totaled $181 million in second-quarter 2024 and $356 million for the first six months of 2024, compared to $234 million in second-quarter 2023 and $441 million for the first six months of 2023, which included $50 million in second-quarter 2023 and $74 million for the first six months of 2023 associated with Cerro Verde’s contested tax rulings issued by the Peru Supreme Court.

Consolidated interest costs (before capitalization) totaled $173 million in third-quarter 2024, $165 million in third-quarter 2023, $529 million for the first nine months of 2024 and $606 million for the first nine months of 2023.

Consolidated interest costs (before capitalization) include a credit of $11 million in the 2024 periods associated with the closure of our 2017 and 2018 U.S.

federal income tax exams and a credit of $13 million in the 2023 periods for the settlement of interest on Cerro Verde’s historical profit sharing liability.

Additionally, the first nine months of 2023 included $74 million of interest charges associated with contested tax rulings issued by the Peruvian Supreme Court.

Capitalized interest varies with the level of qualifying assets associated with our development projects and average interest rates on our borrowings.

Capitalized interest totaled $93 million in second-quarter 2024, $62 million in second-quarter 2023, $179 million for the first six months of 2024 and $119 million for the first six months of 2023.

Capitalized interest added to property, plant, equipment and mine development costs, net, totaled $101 million in third-quarter 2024, $69 million in third-quarter 2023, $280 million for the first nine months of 2024 and $188 million for the first nine months of 2023.

The increase in capitalized interest costs in the 2024 periods, compared to the 2023 periods, resulted from increased construction and development projects in process, primarily related to PT-FI’s new downstream processing facilities.

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Other Income, Net

Other income, net, totaled $69 million in second-quarter 2024, $24 million in second-quarter 2023, $198 million for the first six months of 2024 and $112 million for the first six months of 2023.

The 2023 periods include a $69 million charge associated with Cerro Verde’s contested tax rulings issued by the Peruvian Supreme Court.

The first six months of 2024 include 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 (refer to Note 3).

Other income, net, which totaled $97 million in third-quarter 2024, $71 million in third-quarter 2023, $295 million for the first nine months of 2024 and $183 million for the first nine months of 2023, primarily includes amounts associated with interest income, currency exchange gains and losses, and market-to-market impacts of trust assets used to satisfy financial assurance obligations for our New Mexico mining operations.

The first nine months of 2024 include 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 (refer to Note 3), and the first nine months of 2023 include a $69 million charge associated with Cerro Verde’s contested tax rulings issued by the Peruvian Supreme Court.

Following is a summary of the approximate amounts used in the calculation of our consolidated income tax provision (in millions, except percentages):

Six Months Ended June 30,

Nine Months Ended September 30,

Income (Loss) a

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Tax Rate Income Tax (Provision) Benefit

$ (4) $ 250 —% c

South America 1,196 40% (475) 1,103 40% (441)

Indonesia 4,709 36% (1,706) 3,135 37% (1,156)

Cerro Verde historical tax matters — N/A — (142) d

PT-FI historical tax matters 16 e

Eliminations and other 182 N/A (49) f

Cerro Verde historical tax matters — N/A — (142) e

PT-FI historical tax matters 16 f

Eliminations and other 139 N/A (46)

Rate adjustment g

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Represents income (loss) before income taxes, equity in affiliated companies' net earnings, and noncontrolling interests.

In addition to our North America Copper Mines, which had operating income of $417 million for the first six months of 2024 and $668 million for the first six months of 2023 (refer to Note 8), the U.S.

In addition to our North America copper mines, which had operating income of $587 million for the first nine months of 2024 and $925 million for the first nine months of 2023 (refer to Note 8), the U.S.

jurisdiction reflects non-operating sites and corporate-level expenses, which include interest expense associated with FCX’s senior notes and general and administrative expenses.

jurisdiction also includes net charges associated with oil and gas abandonment obligations and revisions to environmental obligation estimates.

jurisdiction also includes net revisions to environmental obligation estimates and charges associated with oil and gas abandonment obligations and impairments.

Includes net credits associated with the closure of our 2017 and 2018 U.S federal income tax exams.

Refer to Note 3 for further discussion.

Includes a valuation allowance release on prior year unbenefited net operating losses.

Reflects net charges associated with contested tax rulings issued by the Peruvian Supreme Court.

Refer to Note 3 for further discussion of net credits associated with closure of PT-FI’s 2021 corporate income tax audit and resolution of a framework for disputed tax matters.

Includes a tax benefit of $13 million associated with a favorable Supreme Court ruling in Spain, which reversed a 2016 tax law limiting Atlantic Copper’s use of net operating losses.

Refer to Note 3 for further discussion of net credits associated with closure of PT-FI’s 2021 corporate income tax audit and resolution of a framework for Indonesia disputed tax matters.

In accordance with applicable accounting rules, we adjust our interim provision for income taxes equal to our consolidated tax rate.

Assuming achievement of current sales volume and cost estimates and average prices of $4.25 per pound of copper, $2,300 per ounce of gold and $20.00 per pound of molybdenum for the second half of 2024, we estimate our consolidated effective tax rate for the year 2024 would approximate 36% (which reflects an estimated effective

tax rate of 38% for the second half of 2024).

Changes in projected sales volumes and average prices during 2024 would incur tax impacts at estimated effective rates of 39% for Peru, 36% for Indonesia and 0% for the U.S., which excludes any impact from the U.S.

Inflation Reduction Act of 2022.

Our projected estimated effective tax rate of 0% for the U.S.

for the year 2024 may be adjusted as regulations and additional guidance are released by the Internal Revenue Service and U.S.

Department of the Treasury on key provisions of the Act (refer to Note 3).

Assuming achievement of current sales volume and cost estimates and average prices of $4.25 per pound of copper, $2,600 per ounce of gold and $20.00 per pound of molybdenum in fourth-quarter 2024, we estimate our consolidated effective tax rate for the year 2024 would approximate 36% (which reflects an estimated effective tax rate of 40% for fourth-quarter 2024).

Changes in projected sales volumes and average prices during fourth-quarter 2024 would incur tax impacts at estimated effective rates of 39% for Peru, 36% for Indonesia and 0% for the U.S., which excludes the benefits discussed in footnote c under the table above and any impacts from the U.S.

Inflation Reduction Act of 2022 (refer to Note 3).

Noncontrolling Interests

Net income attributable to noncontrolling interests, which is primarily associated with our noncontrolling shareholders at PT-FI, Cerro Verde and El Abra, totaled $0.7 billion in second-quarter 2024, $0.4 billion in second-quarter 2023, $1.4 billion for the first six months of 2024 and $0.8 billion for the first six months of 2023 (refer to Note 8 for net income attributable to noncontrolling interests for each of our business segments).

Net income attributable to noncontrolling interests, which is primarily associated with our noncontrolling shareholders at PT-FI, Cerro Verde and El Abra, totaled $0.7 billion in third-quarter 2024, $0.5 billion in third-quarter 2023, $2.1 billion for the first nine months of 2024 and $1.3 billion for the first nine months of 2023 (refer to Note 8 for net income attributable to noncontrolling interests for each of our business segments).

Beginning January 1, 2023, our economic and ownership interest in PT-FI is 48.76%, except for net income associated with the settlement of historical tax matters in first-quarter 2024 and approximately 190 thousand ounces of gold sales in first-quarter 2023, which were attributed based on the economics prior to January 1, 2023 ( i.e.

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Refer to Note 1 for further discussion.

Based on achievement of current sales volume and cost estimates, and assuming average prices of $4.25 per pound of copper, $2,300 per ounce of gold and $20.00 per pound of molybdenum for the second half of 2024, we estimate that net income attributable to noncontrolling interests will approximate $2.6 billion for the year 2024.

The impact of price changes on net income attributable to noncontrolling interests for the year 2024 would approximate $0.1 billion for each $0.25 per pound change in the average price of copper for the second half of 2024.

In September 2024, we increased our ownership interest in Cerro Verde to 55.08% from 53.56%.

Refer to Note 1 for further discussion.

Based on achievement of current sales volume and cost estimates, and assuming average prices of $4.25 per pound of copper, $2,600 per ounce of gold and $20.00 per pound of molybdenum in fourth-quarter 2024, we estimate that net income attributable to noncontrolling interests will approximate $2.7 billion for the year 2024.

The actual amount will depend on many factors, including relative performance of each business segment, commodity prices, costs and other factors.

Responsible Production

The Copper Mark.

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.

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We are continuing to advance a series of initiatives across our North America and South America operations to incorporate new applications, technologies and data analytics to our leaching processes.

In late 2023, we achieved our initial annual run rate target of approximately 200 million pounds of copper.

Incremental copper production from these initiatives totaled 55 million pounds in second-quarter 2024 (compared with 29 million pounds in second-quarter 2023) and 106 million pounds for the first six months of 2024 (compared with 51 million pounds for the first six months of 2023).

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 58 million pounds in third-quarter 2024 (compared with 46 million pounds in third-quarter 2023) and 164 million pounds for the first nine months of 2024 (compared with 97 million pounds for the first nine months of 2023).

We are pursuing opportunities to apply recent operational enhancements on a larger scale and we are testing new innovative technology applications that we believe have the potential for significant increases in recoverable metal beyond the current run rate.

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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 $38 million in second-quarter 2024, $51 million in second-quarter 2023, $72 million for the first six months of 2024 and $101 million for the first six months of 2023.

The costs for these studies are charged to production and delivery costs as incurred and totaled $45 million in third-quarter 2024, $42 million in third-quarter 2023, $117 million for the first nine months of 2024 and $137 million for the first nine months of 2023.

We estimate the costs of these studies will approximate $175 million for the year 2024, subject to market conditions and other factors.

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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).

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 .

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Bagdad’s reserve life currently exceeds 80 years and supports an expanded operation.

In late 2023, we completed technical and economic studies, which indicated the opportunity to construct new concentrating facilities to increase copper production by 200 to 250 million pounds per year, which is more than double Bagdad’s current annual production rate.

Estimated incremental project capital costs approximate $3.5 billion.

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.

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In parallel, we are advancing activities for expanded tailings infrastructure projects required under long-range plans in order to advance the potential construction timeline.

We are completing projects at our Safford/Lone Star operation to increase volumes to achieve 300 million pounds of copper per year from oxide ores, which reflects expansion of the initial design capacity of 200 million pounds of copper per year.

Additionally, positive drilling conducted in recent years indicates a large, mineralized district with opportunities to pursue a major expansion project.

We have commenced pre-feasibility studies for a potential significant expansion and expect to complete these studies in late 2025.

We have commenced pre-feasibility studies in the Safford/Lone Star district 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 are expecting to complete these studies in late 2025.

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.

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Following is summary consolidated operating data for the North America copper mines:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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Refer to “Consolidated Results” for our consolidated molybdenum sales, which include sales of molybdenum produced at the North America copper mines.

Our consolidated copper sales volumes from North America totaled 292 million pounds in second-quarter 2024, 339 million pounds in second-quarter 2023, 623 million pounds for the first six months of 2024 and 671 million pounds for the first six months of 2023.

Lower copper sales in the 2024 periods, compared with the 2023 periods, primarily reflect lower ore grades and planned mill maintenance, partly offset by improved leach recovery performance.

We continue to advance initiatives to enhance productivity and improve equipment reliability to offset declines in ore grades.

Our consolidated copper sales volumes from North America totaled 316 million pounds in third-quarter 2024, 372 million pounds in third-quarter 2023, 0.9 billion pounds for the first nine months of 2024 and 1.0 billion pounds for the first nine months of 2023.

Lower copper sales in the 2024 periods, compared to the 2023 periods, primarily reflect lower operating rates and ore grades.

Higher third-quarter 2023 sales volumes also reflect the impact of timing of shipments.

North America copper sales are estimated to approximate 1.24 billion pounds for the year 2024.

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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.

Three Months Ended June 30,

Three Months Ended September 30,

By- Product Method Co-Product Method By- Product Method Co-Product Method

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on prior period open sales

0.01 0.01 — (0.03) (0.03) —

Gross profit per pound $ 0.57 $ 0.49 $ 2.88 $ 0.72 $ 0.66 $ 2.86

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Molybdenum sales (millions of recoverable pounds) a

Six Months Ended June 30,

Nine Months Ended September 30,

By- Product Method Co-Product Method By- Product Method Co-Product Method

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Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing.

Includes charges totaling $0.05 per pound of copper in second-quarter 2024 and for the first six months of 2024, and $0.08 per pound of copper in second-quarter 2023 and for the first six months of 2023 for feasibility and optimization studies.

Includes charges totaling $0.06 per pound of copper in third-quarter 2024, $0.05 per pound of copper for the first nine months of 2024, and $0.08 per pound of copper for both the third quarter and first nine months of 2023, for feasibility and optimization studies.

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 $3.19 per pound of copper in second-quarter 2024 and $3.08 per pound for the first six months of 2024 were higher than second-quarter 2023 unit net cash costs of $2.51 per pound and $2.48 per pound for the first six months of 2023, primarily reflecting the impact of lower copper production volumes, higher mining costs and lower molybdenum by-product credits.

Average unit net cash costs (net of by-product credits) for the North America copper mines of $3.24 per pound of copper in third-quarter 2024 and $3.13 per pound for the first nine months of 2024 were higher than average unit net cash costs of $2.70 per pound in third-quarter 2023 and $2.56 per pound for the first nine months of 2023, primarily reflecting lower copper volumes.

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.

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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 our North America copper mines are expected to approximate $3.10 per pound of copper for the year 2024, based on achievement of current sales volume and cost estimates, and assuming an average price of $20.00 per pound of molybdenum for the second half of 2024.

North America’s average unit net cash costs for the year 2024 would change by approximately $0.02 per pound for each $2 per pound change in the average price of molybdenum for the second half of 2024.

Average unit net cash costs (net of by-product credits) for our North America copper mines are expected to approximate $3.14 per pound of copper for the year 2024, based on achievement of current sales volume and cost estimates, and assuming an average price of $20.00 per pound of molybdenum in fourth-quarter 2024.

North America’s average unit net cash costs for the year 2024 would change by approximately $0.01 per pound for each $2 per pound change in the average price of molybdenum in fourth-quarter 2024.

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.

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In addition to copper, the Cerro Verde mine produces molybdenum concentrate and silver.

Labor Matters.

In April 2024, Cerro Verde reached a new four-year collective labor agreement (CLA) with one of its two unions and incurred nonrecurring charges of $65 million in second-quarter 2024 associated with the new CLA.

Cerro Verde expects to begin negotiations with a second union group prior to the expiration of its CLA on August 31, 2024, and may incur additional charges in connection with these negotiations.

Development Activities.

At the El Abra operations in Chile, we have completed substantial drilling and evaluations to model a large sulfide resource that would support a potential major mill project similar to the large-scale concentrator at Cerro Verde.

We are engaged in planning for a potential submission of an environmental impact statement by year-end 2025, subject to ongoing stakeholder engagement and economic evaluations.

In parallel, we are updating our technical studies and economic models to incorporate recent capital costs.

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.

Labor Matters.

In October 2024, Cerro Verde completed a new four-year CLA with one of its two unions.

The agreement follows the successful completion of a new CLA with a second union in April 2024.

Cerro Verde now has multi-year agreements for its hourly workforce.

In connection with the new CLAs, Cerro Verde incurred nonrecurring charges of $34 million in third-quarter 2024 and $99 million for the first nine months of 2024.

Operating Data.

Following is summary consolidated operating data for South America operations:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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Refer to “Consolidated Results” for our consolidated molybdenum sales volumes, which include sales of molybdenum produced at Cerro Verde.

Our consolidated copper sales from South America operations totaled 302 million pounds in second-quarter 2024, 304 million pounds in second-quarter 2023, 586 million pounds for the first six months of 2024 and 606 million pounds for the first six months of 2023.

The 2024 periods, compared to the 2023 periods reflect lower volumes of leach ore placed in stockpiles, partly offset by higher leach ore grades.

The first six months of 2024, compared to the first six months of 2023, also reflect lower milling rates associated with mill maintenance.

Our consolidated copper sales from South America operations were not significantly different in the 2024 periods, compared to the 2023 periods.

Copper sales from South America operations are expected to approximate 1.2 billion pounds for the year 2024.

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Three Months Ended June 30,

Three Months Ended September 30,

Method Co-Product

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Copper sales (millions of recoverable pounds) 293 293 307 307

Six Months Ended June 30,

Nine Months Ended September 30,

Method Co-Product

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Copper sales (millions of recoverable pounds) 879 879 913 913

Includes $0.22 per pound of copper in second-quarter 2024 and $0.11 per pound of copper for the first six months of 2024 associated with nonrecurring labor-related charges at Cerro Verde associated with a new CLA.

Includes charges totaling $0.04 per pound of copper in second-quarter 2024, second-quarter 2023, and for the first six months of 2024, and $0.03 per pound of copper for the first six months of 2023, each for feasibility and optimization studies.

Includes $0.12 per pound of copper in third-quarter 2024 and $0.11 per pound of copper for the first nine months of 2024 for nonrecurring labor-related charges at Cerro Verde associated with new CLAs.

Includes charges totaling $0.06 per pound of copper in third-quarter 2024, $0.05 per pound of copper for the first nine months of 2024, and $0.03 per pound of copper in both the third quarter and first nine months of 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 second-quarter 2024 and $2.53 per pound for the first six months of 2024 were higher than second-quarter 2023 unit net cash costs of $2.28 per pound and $2.24 per pound for the first six months of 2023, primarily reflecting nonrecurring labor-contract charges at Cerro Verde associated with a new CLA and higher mining costs.

Second-quarter 2024 unit net cash costs benefited from the impact of higher molybdenum by-product credits, while the first six months of 2024 had lower molybdenum by-product credits and copper volumes.

Average unit net cash costs (net of by-product credits) for South America operations of $2.44 per pound of copper in third-quarter 2024 and $2.50 per pound for the first nine months of 2024 were higher than average unit net cash costs of $2.35 per pound in third-quarter 2023 and $2.28 per pound for the first nine months of 2023, primarily reflecting nonrecurring labor-related charges at Cerro Verde associated with new CLAs with its two unions and lower by-product credits.

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.

Higher DD&A rates per pound of copper in the 2023 periods primarily reflect a correction in the useful lives of certain fixed assets at Cerro Verde, which resulted in additional depreciation being recognized in second-quarter 2023.

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 $2.47 per pound of copper for the year 2024, based on achievement of current sales volume and cost estimates, and assuming an average price of $20.00 per pound of molybdenum for the second half of 2024.

Average unit net cash costs (net of by-product credits) for South America operations are expected to approximate $2.47 per pound of copper for the year 2024 (which includes $0.08 per pound of copper for nonrecurring labor-related charges at Cerro Verde associated with its new CLAs), based on achievement of current sales volume and cost estimates, and assuming an average price of $20.00 per pound of molybdenum in fourth-quarter 2024.

PT-FI operates one of the world’s largest copper and gold mines at the Grasberg minerals district in Central Papua, Indonesia.

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Regulatory Matters and Mining Rights.

On May 31, 2024, export licenses expired for several exporters, including PT-FI.

In second-quarter 2024, the Indonesia government issued various regulations to allow, under certain conditions, continued exports of copper concentrates and anode slimes through December 2024.

On July 2, 2024, PT-FI was granted copper concentrate and anode slimes export licenses, which are valid through December 2024 when the full ramp-up of PT-FI’s new smelter is expected.

PT-FI will continue to pay a 7.5% export duty on copper concentrates during the smelter ramp-up period pursuant to Indonesia regulations.

As further discussed in FCX’s 2023 Form 10-K, PT-FI’s current special mining license (IUPK) enables it to conduct operations in the Grasberg minerals district through 2041.

On May 30, 2024, the Indonesia government issued a regulation applicable to the country’s mineral and coal industries which outlines requirements for the granting of IUPK extensions.

The regulation provides that IUPK holders may be granted a life-of-mine extension provided certain conditions are met, including ownership of integrated downstream processing facilities that have entered the operational stage;

On July 2, 2024, PT-FI was granted copper concentrate and anode slimes export licenses, which are valid through December 2024.

Pursuant to the Indonesia regulations, PT-FI is continuing to pay a 7.5% export duty on copper concentrates.

See below for further discussion of the recent fire event at PT-FI's new smelter facility.

As further discussed in FCX’s 2023 Form 10-K, PT-FI’s current special mining business license (IUPK) enables it to conduct operations in the Grasberg minerals district through 2041.

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 Minerals.

Application for extension may be submitted at any time up to one year prior to the current IUPK expiration.

PT-FI expects to apply for an extension under this new regulation during 2024.

Application for extension may be submitted at any time up to one year prior to the expiration of its current IUPK.

PT-FI is currently preparing its application submittal.

In connection with PT-FI’s application for extension, we are working to reach terms 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.

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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 and Big Gossan).

Milling rates averaged 196,900 metric tons of ore per day during second-quarter 2024, which reflected reduced rates in June 2024 because of the delay in obtaining PT-FI’s export licenses, and 208,200 metric tons of ore per day for the first six months of 2024, a 12% increase from 186,100 metric tons of ore per day for the first six months of 2023.

PT-FI is completing a mill recovery project with the installation of a new copper cleaner circuit, which is expected to begin commissioning in the second half of 2024.

Natural Gas Facilities.

PT-FI plans to transition its existing energy source from coal to liquefied natural gas, which would meaningfully reduce PT-FI’s Scope 1 greenhouse gas emissions at the Grasberg minerals district.

PT-FI’s planned investments in a new gas-fired combined cycle facility is expected to be incurred over the next four years, at a cost of approximately $1 billion, which represents an incremental cost of $0.4 billion compared to previously planned investments to refurbish the existing coal units.

Long-term mine development activities are ongoing for PT-FI’s Kucing Liar deposit in the Grasberg minerals district, which is expected to produce over 7 billion pounds of copper and 6 million ounces of gold between 2029 and the end of 2041.

An extension of PT-FI’s operating rights beyond 2041 would extend the life of the project.

Pre-production development activities commenced in 2022 and are expected to continue over an approximate 10-year timeframe.

Capital investments are estimated to average approximately $400 million per year over this period.

At full operating rates of approximately 90,000 metric tons of ore per day, 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.

PT-FI is completing a mill recovery project with the installation of a new copper cleaner circuit, which is expected to begin commissioning in late 2024.

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, with capital investments estimated to average approximately $400 million per year over this period.

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.

PT-FI’s planned investments in a new gas-fired combined cycle facility are expected to be incurred over the next four years, at a cost of approximately $1 billion, which 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.

PT-FI substantially completed construction of its new smelter in June 2024 and commenced commissioning operations.

The new smelter has a capacity to process approximately 1.7 million metric tons of copper concentrate per year and is expected to begin producing copper cathodes in the coming months with ramp-up to full production targeted by year-end 2024 in line with previous expectations.

The PMR is being constructed to process gold and silver from the new smelter and PT Smelting.

Construction is in progress with full production expected by year-end 2024.

During the first six months of 2024, capital expenditures for the new downstream processing facilities totaled $0.7 billion and are expected to approximate $1.0 billion for the year 2024, excluding capitalized interest and $0.3 billion

of estimated commissioning and owner’s costs.

As of June 30, 2024, $3.8 billion has been incurred to date for the projects.

On October 14, 2024, a fire occurred during commissioning of PT-FI’s new smelter in Gresik, Indonesia, following an equipment malfunction in the smelter furnace.

The fire resulted in damage to a gas cleaning facility (electrostatic precipitator plant) and infrastructure for the production of sulfuric acid.

There were no injuries.

Smelter start-up operations have been temporarily suspended pending remediation activities.

Mining operations in Central Papua and the completion and ramp-up of the PMR project have not been impacted.

PT-FI has substantially completed initial damage assessments and currently estimates repair costs to approximate $100 million, which are expected to be offset through recovery under construction insurance programs.

Remediation plans are in progress, including the procurement of long-lead items.

Based on current delivery timelines, which continue to be evaluated, PT-FI currently expects to recommence start-up operations by mid-2025.

Efforts are under way to expedite equipment orders to potentially improve the schedule.

PT-FI is working with the Indonesia government to allow continued exports of copper concentrates until full ramp-up of PT-FI’s new downstream processing facilities is achieved, including seeking an increase to the permitted quota for 2024.

In December 2023, PT Smelting completed an expansion of its capacity by 30% to 1.3 million metric tons of copper concentrate per year.

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Following is summary consolidated operating data for Indonesia operations:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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Gold 77.2 77.8 77.3 77.5

PT-FI’s consolidated copper and gold sales volumes for the second quarter and first six months of 2024 were impacted by previously announced shipping delays in Indonesia associated with the timing of renewing PT-FI’s copper concentrate and anode slimes export licenses, which expired on May 31, 2024.

On July 2, 2024, PT-FI was granted copper concentrate and anode slimes export licenses, which are valid through December 2024 when the full ramp-up of PT-FI’s new smelter is expected.

PT-FI’s consolidated copper sales volumes totaled 337 million pounds in second-quarter 2024, 386 million pounds in second-quarter 2023, 830 million pounds for the first six months of 2024 and 584 million pounds for the first six months of 2023.

PT-FI’s consolidated copper sales volumes for the 2024 periods benefited from higher ore grades and higher consolidated copper sales volumes for the first six months of 2024 also reflect higher mining and milling rates.

PT-FI’s consolidated gold sales volumes totaled 356 thousand ounces in second-quarter 2024, 492 thousand ounces in second-quarter 2023, 920 thousand ounces for the first six months of 2024 and 758 thousand ounces for the first six months of 2023.

PT-FI’s consolidated gold sales volumes for the first six months of 2024 benefited from higher mining and milling rates.

PT-FI’s consolidated copper sales volumes totaled 426 million pounds in third-quarter 2024, 430 million pounds in third-quarter 2023, 1.3 billion pounds for the first nine months of 2024 and 1.0 billion pounds for the first nine

months of 2023.

Higher sales volumes for the first nine months of 2024, compared to the 2023 period, primarily reflected higher ore grades and higher mining and milling rates.

PT-FI’s consolidated gold sales volumes of 554 thousand ounces in third-quarter 2024 were higher than third-quarter 2023 gold sales volumes of 395 thousand ounces, primarily reflecting timing of shipments, partly offset by lower production from lower ore grades.

PT-FI’s consolidated gold sales volumes of 1.5 million ounces for the first nine months of 2024 were higher than 1.2 million ounces for the first nine months of 2023, primarily reflecting higher mining and milling rates and timing of shipments.

Consolidated sales volumes from PT-FI are expected to approximate 1.65 billion pounds of copper and 1.8 million ounces of gold for the year 2024.

Consolidated copper and gold production volumes from PT-FI for the year 2024 are expected to exceed 2024 sales volumes, reflecting the deferral of approximately 100 million pounds of copper and 120 thousand ounces of gold that will be processed by the new downstream processing facilities and sold as refined metal in 2025.

Consolidated copper and gold production volumes from PT-FI for the year 2024 are expected to exceed 2024 sales volumes, reflecting the deferral of approximately 85 million pounds of copper and 85 thousand ounces of gold associated with inventories held at PT-FI’s new downstream processing facilities expected to be sold as refined metal in 2025.

Projected sales volumes are dependent on operational performance;

the timing of ramp-up of PT-FI’s new smelter;

continuation of copper concentrate exports during the restoration period of PT-FI’s new smelter;

weather-related conditions;

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Refer to “Product Revenues and Production Costs” for an explanation of “by-product” and “co-product” methods and a reconciliation of unit net cash credits per pound to production and delivery costs applicable to sales reported in our consolidated financial statements.

Three Months Ended June 30,

Three Months Ended September 30,

By-Product Method Co-Product Method By-Product Method Co-Product Method

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DD&A 0.80 0.44 263 0.63 0.43 214

Noncash and other costs, net 0.19 b,c

0.12 62 0.20 c,d

Noncash and other costs, net 0.12 b

0.07 41 0.02 b

Total unit costs 0.21 2.05 1,219 1.09 1.97 993

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Gold sales (thousands of recoverable ounces) 554 395

Six Months Ended June 30,

Nine Months Ended September 30,

By-Product Method Co-Product Method By-Product Method Co-Product Method

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Noncash and other costs, net 0.11 b,c

0.07 34 0.18 c,d

0.06 36 0.11 b,d

Total unit costs 0.50 2.02 1,124 0.94 2.03 1,028

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As discussed above and in Note 7, PT-FI will continue to pay export duties of 7.5% on copper concentrates during the smelter ramp-up period pursuant to Indonesia regulations.

Includes charges totaling $0.10 per pound of copper in second-quarter 2024 and $0.04 per pound of copper for the first six months of 2024 for amounts capitalized in prior years associated with construction of the new downstream processing facilities.

Includes charges totaling $0.06 per pound of copper in second-quarter 2024 and $0.04 per pound of copper for the first six months of 2024 for operational readiness and startup costs associated with the new downstream processing facilities and $0.03 per pound of copper in second-quarter 2023 and $0.04 per pound of copper for the first six months of 2023 for feasibility and optimization studies.

Includes charges totaling $0.14 per pound of copper in second-quarter 2023 and $0.09 per pound of copper for the first six months of 2023 associated with a potential administrative fine.

PT-FI’s unit net cash credits (including gold, silver and other by-product credits) were $0.21 per pound of copper in second-quarter 2024 and $0.15 per pound of copper for the first six months of 2024, compared to $0.09 per pound of copper in second-quarter 2023 and $0.08 per pound of copper for the first six months of 2023.

Favorable unit net cash credits in the 2024 periods, compared with the 2023 periods, primarily reflect lower costs associated with timing of sales related to previously announced shipping delays, partly offset by higher export duties.

As discussed above and in Note 7, PT-FI is continuing to pay export duties of 7.5% on copper concentrates.

Includes (i) charges totaling $0.09 per pound of copper in third-quarter 2024 and $0.06 per pound of copper for the first nine months of 2024 for operational readiness and start-up costs associated with PT-FI’s new downstream processing facilities and (ii) $0.01 per pound of copper in third-quarter 2024 and 2023 and $0.02 per pound of copper for the first nine months of 2024 and 2023 for feasibility and optimization studies.

Includes charges totaling $0.03 per pound of copper for the first nine months of 2024 for amounts capitalized in prior years associated with construction of PT-FI’s new downstream processing facilities.

Includes a charge totaling $0.05 per pound of copper for the first nine months of 2023 associated with a potential administrative fine.

PT-FI’s unit net cash credits (including gold, silver and other by-product credits) were $0.71 per pound of copper in third-quarter 2024 and $0.34 per pound of copper for the first nine months of 2024, and PT-FI’s unit net cash costs (net of gold, silver and other by-product credits) were $0.44 per pound of copper in third-quarter 2023 and $0.14 per pound of copper for the first nine months of 2023.

Unit net cash credits for the 2024 periods, compared to the 2023 periods, primarily reflect higher gold credits.

Additionally, PT-FI’s site production and delivery costs will vary with the volume of metals sold, including the ratio of copper and gold sales within a period.

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’s royalties totaled $90 million in second-quarter 2024, $92 million in second-quarter 2023, $209 million for the first six months of 2024 and $150 million for the first six months of 2023.

Export duties totaled $75 million in second-quarter 2024, $231 million for the first six months of 2024 and $18 million for the first six months of 2023.

PT-FI’s royalties totaled $129 million in third-quarter 2024, $78 million in third-quarter 2023, $338 million for the first nine months of 2024 and $228 million for the first nine months of 2023.

Export duties totaled $129 million in third-quarter 2024, $147 million in third-quarter 2023, $360 million for the first nine months of 2024 and $165 million for the first nine months of 2023.

Refer to Note 7 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 production and sales.

The DD&A rate per pound of copper is expected to be higher in the second half of 2024, compared with the 2024 and 2023 periods, as the downstream processing facilities are placed into service.

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.

PT Smelting’s intercompany profit for the first six months of 2023 represents the change in the deferral of 39.5% of PT-FI’s profit on sales to PT Smelting.

PT Smelting’s intercompany profit for the first nine months of 2023 represents the change in the deferral of 39.5% of PT-FI’s profit on sales to PT Smelting before 2023.

Beginning in 2023, PT-FI’s commercial arrangement with PT Smelting changed to a tolling arrangement and there are no further sales from PT-FI to PT Smelting.

Refer to Note 1 for further discussion of PT-FI’s equity investment in PT Smelting.

Average unit net cash credits (including gold, silver and other by-product credits) for PT-FI are expected to approximate $0.07 per pound of copper for the year 2024, based on achievement of current sales volumes and cost estimates, and assuming an average price of $2,300 per ounce of gold for the second half of 2024.

PT-FI’s average unit net cash credits for the year 2024 would change by approximately $0.06 per pound of copper for each $100 per ounce change in the average price of gold for the second half of 2024.

PT-FI’s projected sales volumes and unit net cash credits for the year 2024 are dependent on operational performance;

the timing of the ramp-up of PT-FI’s new smelter in Indonesia;

Average unit net cash credits (including gold, silver and other by-product credits) for PT-FI are expected to approximate $0.23 per pound of copper for the year 2024, based on achievement of current sales volumes and cost estimates, and assuming an average price of $2,600 per ounce of gold in fourth-quarter 2024.

PT-FI’s average unit net cash credits for the year 2024 would change by approximately $0.03 per pound of copper for each $100 per ounce change in the average price of gold in fourth-quarter 2024.

PT-FI’s unit net cash credits for the year 2024 are dependent on operational performance;

continuation of copper concentrate exports during the restoration period of PT-FI’s new smelter;

weather-related conditions;

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Operating and Development Activities.

Production from the primary molybdenum operations totaled 7 million pounds of molybdenum in each of second-quarter 2024 and 2023 and 15 million pounds during both the first six months of 2024 and 2023.

Production from the primary molybdenum operations totaled 6 million pounds of molybdenum in third-quarter 2024, 7 million pounds in third-quarter 2023, 21 million pounds for the first nine months of 2024 and 22 million pounds for the first nine months of 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.

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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 the primary molybdenum operations of $19.41 per pound of molybdenum in second-quarter 2024 and $17.50 per pound for the first six months of 2024 were higher than average unit net cash costs of $15.99 per pound in second-quarter 2023 and $13.95 per pound for the first six months of 2023, primarily reflecting higher transitional contract-labor costs and operating and maintenance supply costs.

Average unit net cash costs for the primary molybdenum operations of $21.06 per pound of molybdenum in third-quarter 2024 and $18.59 per pound for the first nine months of 2024 were higher than average unit net cash costs of $18.07 per pound in third-quarter 2023 and $15.25 per pound for the first nine months of 2023, primarily reflecting higher costs for maintenance supplies and transitional contract labor and lower volumes.

Average unit net cash costs for the primary molybdenum operations are expected to approximate $17.55 per pound of molybdenum for the year 2024, based on achievement of current sales volumes and cost estimates.

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Through our downstream integration, we are able to assure placement of a significant portion of our copper concentrate production.

We wholly own and operate the Miami smelter in Arizona, Atlantic Copper (a smelter and refinery in Spain), and the El Paso refinery in Texas.

In June 2024, PT-FI substantially completed construction of its new smelter in Indonesia and commenced commissioning operations.

Further, PT-FI expects to complete its new PMR by year-end 2024.

The new smelter will smelt and refine copper concentrate from PT-FI and the PMR will process anode slimes from the new smelter and PT Smelting.

We wholly own and operate the Miami smelter in Arizona, Atlantic Copper, and the El Paso refinery in Texas.

In June 2024, PT-FI substantially completed construction of its new smelter in Indonesia and commenced commissioning operations in third-quarter 2024.

On October 14, 2024, a fire occurred during commissioning and smelter start-up operations have been temporarily suspended pending remediation activities (for further discussion refer to “Operations – Indonesia – Downstream Processing Facilities”).

The PMR project was not impacted, and PT-FI expects to complete construction of the PMR by year-end 2024.

The new smelter will smelt and refine copper

concentrate from PT-FI and the PMR will process anode slimes from the new smelter and PT Smelting.

PT-FI also has a 66% (39.5% prior to June 30, 2024) ownership interest in PT Smelting, a copper smelter and refinery in Gresik, Indonesia (refer to Note 1).

As a result, 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 (refer to “Indonesia Operations – Downstream Processing Facilities” above).

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.

Atlantic Copper smelts and refines copper concentrate and markets refined copper and precious metals in slimes.

During the first six months of 2024, Atlantic Copper’s copper concentrate purchases included 30% from our copper mining operations and 70% from third parties.

During the first nine months of 2024, Atlantic Copper’s copper concentrate purchases included 27% from our copper mining operations and 73% 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.

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We defer recognizing profits on sales from our mining operations to Atlantic Copper until final sales to third parties occur.

Our net deferred profits on our inventories at Atlantic Copper to be recognized in future periods’ operating income totaled $97 million ($30 million to net income attributable to common stock) at June 30, 2024.

Our net deferred profits on our inventories at Atlantic Copper to be recognized in future periods’ operating income totaled $143 million ($44 million to net income attributable to common stock) at September 30, 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.

FCX currently expects the deferral of profit recognition on sales to Atlantic Copper in third-quarter 2024 to result in a reduction to operating income of approximately $50 million (approximately $15 million to

net income attributable to common stock), which will be recognized in future periods as Atlantic Copper sells final refined products to third parties.

In May 2024, the U.S.

Environmental Protection Agency (EPA) amended its rule establishing standards for hazardous air pollutant emissions from primary copper smelters.

Environmental Protection Agency (EPA) published a final rule updating the standards for hazardous air pollutant emissions from primary copper smelters.

We are evaluating this final rule to determine to what extent we would need to modify our processes and equipment and the costs involved, which could be significant.

We expect that this final rule will impact our Miami, Arizona smelter operations, which processes a significant portion of the copper concentrate produced by our North America copper mines.

We expect that 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 have appealed the EPA’s final rule to the Court of Appeals for the D.C.

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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 discussed in “Outlook,” our available cash and cash equivalents plus our projected consolidated operating cash flows of $7.2 billion for the year 2024 exceed our expected consolidated capital expenditures of $4.7 billion (which includes $2.3 billion for major mining projects and $1.0 billion for PT-FI’s new downstream processing facilities) for the year 2024.

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.

At June 30, 2024, we had $5.3 billion in consolidated cash and cash equivalents, and FCX, PT-FI and Cerro Verde have $3.0 billion, $1.75 billion and $350 million, respectively, of availability under their revolving credit facilities.

On July 31, 2024, PT-FI borrowed $250 million under its revolving credit facility to fund capital expenditures for PT-FI’s new downstream processing facilities.

At June 30, 2024, we had $1.0 billion in current restricted cash and cash equivalents, including $0.9 billion associated with PT-FI's export proceeds temporarily deposited in Indonesia banks for 90 days in accordance with a regulation issued by the Indonesia government.

Based on current sales volume, cost and metal price estimates discussed in “Outlook,” our available cash and cash equivalents plus our projected consolidated operating cash flows of $6.8 billion for the year 2024 exceed our expected consolidated capital expenditures of $4.6 billion for the year 2024.

At September 30, 2024, we had $5.0 billion in consolidated cash and cash equivalents, and FCX, PT-FI and Cerro Verde have $3.0 billion, $1.5 billion and $350 million, respectively, of availability under their revolving credit facilities.

At September 30, 2024, we had $1.1 billion in current restricted cash and cash equivalents, including $1.0 billion associated with PT-FI's export proceeds temporarily deposited in Indonesia banks for 90 days in accordance with a regulation issued by the Indonesia government.

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.

Our financial policy is aligned with our strategic objectives of maintaining a strong 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 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 of Directors (Board) reviews the structure of the performance-based payout framework at least annually.

At June 30, 2024, FCX’s net debt, excluding $3.0 billion of debt for PT-FI’s new downstream processing facilities, totaled $0.3 billion (which was net of $0.9 billion of current restricted cash associated with PT-FI’s export proceeds).

At September 30, 2024, our net debt, excluding $3.2 billion of debt for PT-FI’s new downstream processing facilities, totaled $0.5 billion (which was net of $1.0 billion of current restricted cash associated with PT-FI’s export proceeds).

Refer to "Net Debt" for further discussion.

On June 26, 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 quarterly variable, performance-based cash dividend), which were paid on August 1, 2024, to common stockholders of record as of July 15, 2024.

Based on current market conditions, the base and variable dividends on our common stock are anticipated to total $0.60 per share for 2024 (including the dividends paid on February 1, 2024, May 1, 2024, and August 1, 2024), comprised of a $0.30 per share base dividend and $0.30 per share variable dividend.

On September 25, 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 quarterly variable, performance-based cash dividend), which were paid on November 1, 2024, to common stockholders of record as of October 15, 2024.

The base and variable dividends on our common stock totaled $0.60 per share for 2024, 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) 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.

In July 2024, FCX acquired 1.2 million shares of its common stock for a total cost of $59 million ($50.48 average cost per share) bringing total purchases under its $5.0 billion share repurchase program to 49.0 million shares of common stock for a cost of $1.9 billion ($38.64 average cost per share).

The timing and amount of share repurchases is 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 our Board’s discretion.

We acquired 1.2 million shares of our common stock in July 2024 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 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.

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, taxes and other costs at June 30, 2024 (in billions):

and international components of consolidated cash and cash equivalents available to the parent company, net of noncontrolling interests’ share and withholding taxes at September 30, 2024 (in billions):

Cash at domestic companies $ 2.1

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through dividends that are subject to applicable withholding taxes and noncontrolling interests’ share.

At June 30, 2024, consolidated debt totaled $9.4 billion, with a weighted-average interest rate of 5.2%.

At September 30, 2024, consolidated debt totaled $9.7 billion, with a weighted-average interest rate of 5.2%.

Substantially all of our outstanding debt is fixed rate.

We have $0.7 billion in scheduled senior note maturities in November 2024 with no further senior note maturities until 2027.

We have $0.7 billion in scheduled senior note maturities in November 2024, which we expect to redeem with cash on hand.

Our next senior note maturities are in 2027.

Our total debt has an average remaining duration of approximately 9 years.

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Operating Activities

We generated operating cash flows of $3.9 billion for the first six months of 2024 and $2.7 billion for the first six months of 2023.

Higher operating cash flows for the first six months of 2024, compared with the first six months of 2023, primarily reflects higher copper and gold sales volumes and higher average realized prices.

We generated operating cash flows of $5.7 billion for the first nine months of 2024 and $4.0 billion for the first nine months of 2023.

Higher operating cash flows for the first nine months of 2024, compared with the first nine months of 2023, primarily reflects higher average realized copper and gold prices and higher gold sales volumes, as well as changes in accruals for international income taxes and other working capital changes related to PT-FI’s tolling arrangement with PT Smelting.

Investing Activities

Capital Expenditures.

Capital expenditures, including capitalized interest, totaled $2.4 billion for the first six months of 2024 and $2.3 billion for the first six months of 2023, including amounts for major mining projects ($0.9 billion for the first six months of 2024 and $0.8 billion for the first six months of 2023), primarily associated with underground development activities in the Grasberg minerals district and for PT-FI’s new downstream processing facilities ($0.7 billion for the first six months of 2024 and $0.8 billion for the first six months of 2023).

Capital expenditures, including capitalized interest, totaled $3.6 billion for the first nine months of 2024 and $3.5 billion for the first nine months of 2023, including amounts for major mining projects ($1.3 billion for the first nine months of 2024 and $1.2 billion for the first nine months of 2023), primarily associated with underground development activities in the Grasberg minerals district, and for PT-FI’s new downstream processing facilities ($1.0 billion for the first nine months of 2024 and $1.3 billion for the first nine months of 2023).

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 for the first nine months of 2024 and $109 million for the first nine months of 2023 to fund PT Smelting’s expansion project.

Financing Activities

Debt Transactions.

Net repayments of debt totaling $1.1 billion for the first six months of 2023 reflected the repayment of our 3.875% Senior Notes that matured in March 2023.

Net proceeds from debt totaled $249 million for the first nine months of 2024, primarily related to 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 for the first nine months of 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 $0.4 billion during each of the first six months of 2024 and 2023.

We paid cash dividends on our common stock totaling $0.6 billion during each of the first nine months of 2024 and 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.

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Cash Dividends and Distributions Paid to Noncontrolling Interests.

Cash dividends and distributions paid to noncontrolling interests at our international operations totaled $0.7 billion (including $0.6 billion from PT-FI) for the first six months of 2024 and $0.3 billion (including $0.2 billion from PT-FI ) for the first six months of 2023.

Cash dividends and distributions paid to noncontrolling interests at our international operations totaled $1.3 billion (including $1.1 billion from PT-FI) for the first nine months of 2024 and $0.4 billion (including $0.2 billion from PT-FI) for the first nine months of 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 July 2024, we acquired 1.2 million shares of our common stock for a total cost of $59 million.

CONTRACTUAL OBLIGATIONS

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We perform a comprehensive annual review of our environmental obligations and AROs and also review changes in facts and circumstances associated with these obligations at least quarterly.

As discussed in Note 7, we recorded net charges totaling $79 million for the first six months of 2024, primarily associated with changes in cost estimates for former processing facilities and historical smelter sites.

In addition, we recorded net ARO additions totaling $0.4 billion in the first six months of 2024, including $0.3 billion at mining operations primarily associated with revised closure plans and cost estimates to reflect our commitment to the Global Industry Standard on Tailings Management and $0.1 billion at our oil and gas properties primarily associated with assumed abandonment obligations resulting from bankruptcies of other companies.

As discussed in Note 7, we recorded net charges totaling $82 million for the first nine months of 2024, primarily associated with changes in cost estimates for former processing facilities and historical smelter sites.

In addition, we recorded net ARO additions totaling $0.4 billion in the first nine months of 2024, including $0.3 billion at mining operations primarily associated with revised closure plans and cost estimates to reflect our commitment to the Global Industry Standard on Tailings Management and $0.1 billion at our oil and gas properties primarily associated with assumed abandonment obligations resulting from bankruptcies of other companies.

Refer to Note 12 of our 2023 Form 10-K for further information about contingencies associated with environmental matters and AROs.

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GAAP and should not be considered in isolation or as a substitute for consolidated debt determined in accordance with U.S.

Our net debt, which may not be comparable to similarly titled measures reported by other companies, follows (in billions):

As of June 30, 2024

Our net debt, which may not be comparable to similarly titled measures reported by other companies, follows (in millions):

As of September 30, 2024

Current portion of debt $ 769

Long-term debt, less current portion 8,910

Consolidated debt 9.4 a

Consolidated debt 9,679

consolidated cash and cash equivalents 5,000

current restricted cash associated with PT-FI’s export proceeds b

FCX net debt 3.3 a

debt for PT-FI’s new downstream processing facilities c

current restricted cash associated with PT-FI’s export proceeds 964 a

FCX net debt 3,715

debt for PT-FI’s new downstream processing facilities 3,232 b

FCX net debt, excluding debt for PT-FI’s new downstream processing facilities $ 483

Does not foot because of rounding.

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.

Represents senior notes issued by PT-FI.

Represents PT-FI’s senior notes and $250 million of borrowings under PT-FI’s revolving credit facility.

PRODUCT REVENUES AND PRODUCTION COSTS

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North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(In millions) By-Product Co-Product Method

45 unchanged sentences

North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

(In millions) By-Product Co-Product Method

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on prior period open sales 1 1 — — 1

Gross profit (loss) $ 320 $ 280 $ 46 $ (6) $ 320

Gross profit $ 269 $ 244 $ 21 $ 4 $ 269

Copper sales (millions of recoverable pounds) 372 372

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North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In millions) By-Product Co-Product Method

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Total costs 3,415 3,466 393 116 3,975

Other revenue adjustments, primarily for pricing

on prior period open sales — — — — —

Gross profit $ 633 $ 582 $ 40 $ 11 $ 633

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Total unit costs 3.62 3.68 18.14

Other revenue adjustments, primarily for pricing

on prior period open sales — — —

Gross profit per pound $ 0.67 $ 0.61 $ 1.83

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Includes charges totaling $48 million ($0.05 per pound of copper) for feasibility and optimization studies.

Represents the combined total for our other mining operations as presented in Note 8.

Represents the combined total for our other segments as presented in Note 8.

North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

(In millions) By-Product Co-Product Method

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on prior period open sales 13 13 — — 13

Gross profit (loss) $ 731 $ 647 $ 87 $ (3) $ 731

Gross profit $ 1,000 $ 890 $ 109 $ 1 $ 1,000

Copper sales (millions of recoverable pounds) 1,048 1,048

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Includes charges totaling $81 million ($0.08 per pound of copper) for feasibility and optimization studies.

Represents the combined total for our other mining operations as presented in Note 8.

Represents the combined total for our other segments as presented in Note 8.

South America Operations Product Revenues, Production Costs and Unit Net Cash Costs

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(In millions) By-Product Co-Product Method

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Also reflects sales of molybdenum produced by Cerro Verde to our molybdenum sales company at market-based pricing.

Includes nonrecurring charges totaling $65 million ($0.22 per pound of copper) associated with labor-related charges at Cerro Verde associated with a new CLA.

Includes nonrecurring labor-related charges totaling $34 million ($0.12 per pound of copper) at Cerro Verde associated with the new CLAs with its two unions.

Includes charges totaling $18 million ($0.06 per pound of copper) for feasibility studies.

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South America Operations Product Revenues, Production Costs and Unit Net Cash Costs

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

(In millions) By-Product Co-Product Method

47 unchanged sentences

South America Operations Product Revenues, Production Costs and Unit Net Cash Costs

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In millions) By-Product Co-Product Method

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Also reflects sales of molybdenum produced by Cerro Verde to FCX’s molybdenum sales company at market-based pricing.

Includes nonrecurring charges totaling $65 million ($0.11 per pound of copper) associated with labor-related charges at Cerro Verde associated with a new CLA.

Includes nonrecurring labor-related charges totaling $99 million ($0.11 per pound of copper) at Cerro Verde associated with the new CLAs with its two unions.

Includes charges totaling $41 million ($0.05 per pound of copper) for feasibility studies.

Represents the combined total for our other mining operations as presented in Note 8.

Represents the combined total for our other segments as presented in Note 8.

South America Operations Product Revenues, Production Costs and Unit Net Cash Costs

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

(In millions) By-Product Co-Product Method

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Includes charges totaling $30 million ($0.03 per pound of copper) for feasibility studies.

Represents the combined total for our other mining operations as presented in Note 8.

Represents the combined total for our other segments as presented in Note 8.

Indonesia Operations Product Revenues, Production Costs and Unit Net Cash (Credits) Costs

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(In millions) Co-Product Method

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on prior period open sales (10) — —

Eliminations and other — (1) —

Indonesia operations 2,982 918 340

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Includes silver sales of 2.1 million ounces ($30.11 per ounce average realized price).

Includes charges totaling $34 million ($0.10 per pound of copper) related to the reversal of previously capitalized land lease depreciation, which related to prior years.

Also, includes charges totaling $20 million ($0.06 per pound of copper) for PT-FI’s new downstream processing facilities’ operational readiness and startup costs.

Includes charges totaling $39 million ($0.09 per pound of copper) for operational readiness and start-up costs associated with PT-FI’s new downstream processing facilities, and $5 million ($0.01 per pound of copper) for feasibility and optimization studies.

Represents tolling costs paid to PT Smelting.

Represents the combined total for our other segments as presented in Note 8.

Indonesia Operations Product Revenues, Production Costs and Unit Net Cash (Credits) Costs

Three Months Ended June 30, 2023

Indonesia Operations Product Revenues, Production Costs and Unit Net Cash Costs

Three Months Ended September 30, 2023

(In millions) Co-Product Method

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Treatment charges 138 93 43 2 138

Export duties 147 99 46 2 147

Royalty on metals 78 52 25 1 78

Net cash (credits) costs (34) 577 374 17 968

Net cash costs 190 657 305 13 975

DD&A 271 183 84 4 271

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Treatment charges 0.32 0.22 109

Export duties 0.34 0.23 116

Royalty on metals 0.19 0.12 64

Unit net cash (credits) costs (0.09) 1.49 759

Unit net cash costs 0.44 1.53 773

DD&A 0.63 0.43 214

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Treatment charges (87) 51 c

Export duties (147) — —

Royalty on metals (78) — —

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on prior period open sales 5 — —

Eliminations and other — 1 —

Indonesia operations 2,095 672 271

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Includes silver sales of 1.3 million ounces ($22.96 per ounce average realized price).

Includes charges totaling $55 million ($0.14 per pound of copper) associated with a potential administrative fine and charges totaling $12 million ($0.03 per pound of copper) for feasibility and optimization studies.

Includes charges totaling $3 million ($0.01 per pound of copper) for feasibility and optimization studies.

Primarily represents tolling costs paid to PT Smelting.

Represents the combined total for our other mining operations as presented in Note 8.

Represents the combined total for our other segments as presented in Note 8.

Indonesia Operations Product Revenues, Production Costs and Unit Net Cash (Credits) Costs

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In millions) Co-Product Method

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Includes silver sales of 5.5 million ounces ($28.01 per ounce average realized price).

Includes charges totaling $34 million ($0.04 per pound of copper) related to the reversal of previously capitalized land lease depreciation, which related to prior years.

Also, includes charges totaling $35 million ($0.04 per pound of copper) for PT-FI’s new downstream processing facilities’ operational readiness and startup costs.

Includes charges totaling (i) $74 million ($0.06 per pound of copper) for operational readiness and start-up costs associated with PT-FI’s new downstream processing facilities, (ii) $34 million ($0.03 per pound of copper) related to amounts capitalized in prior years associated with the construction of PT-FI’s new downstream processing facilities, and (iii) $22 million ($0.02 per pound of copper) for feasibility and optimization studies.

Represents tolling costs paid to PT Smelting.

Represents the combined total for our other mining operations as presented in Note 8.

Indonesia Operations Product Revenues, Production Costs and Unit Net Cash (Credits) Costs

Six Months Ended June 30, 2023

Represents the combined total for our other segments as presented in Note 8.

Indonesia Operations Product Revenues, Production Costs and Unit Net Cash Costs

Nine Months Ended September 30, 2023

(In millions) Co-Product Method

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Royalty on metals 228 144 81 3 228

Net cash (credits) costs (48) 900 587 29 1,516

Net cash costs 141 1,555 894 42 2,491

DD&A 694 433 249 12 694

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Royalty on metals 0.23 0.14 70

Unit net cash (credits) costs (0.08) 1.54 775

Unit net cash costs 0.14 1.53 776

DD&A 0.69 0.43 216

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Includes silver sales of 4.0 million ounces ($23.37 per ounce average realized price).

Includes a charge of $55 million ($0.09 per pound of copper) associated with a potential administrative fine and charges totaling $25 million ($0.04 per pound of copper) for feasibility and optimization studies.

Includes a charge of $55 million ($0.05 per pound of copper) associated with a potential administrative fine and $22 million ($0.02 per pound of copper) for feasibility and optimization studies.

Primarily represents tolling costs paid to PT Smelting.

Represents the combined total for our other mining operations as presented in Note 8.

Represents the combined total for our other segments as presented in Note 8.

Molybdenum Mines Product Revenues, Production Costs and Unit Net Cash Costs

Three Months Ended June 30,

Three Months Ended September 30,

(In millions) 2024 2023

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Reconciliation to Amounts Reported

Three Months Ended June 30, 2024 Revenues and Delivery DD&A

Three Months Ended September 30, 2024 Revenues and Delivery DD&A

Totals presented above $ 138 $ 131 $ 19

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8,225 5,354 567

Corporate, other & eliminations (1,433) (1,493) 17

Corporate, other & eliminations c

(1,567) (1,417) 14

As reported in our consolidated financial statements $ 6,790 $ 4,077 $ 600

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Totals presented above $ 153 $ 116 $ 14

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7,274 5,024 501

Corporate, other & eliminations (1,609) (1,557) 19

Corporate, other & eliminations c

(1,597) (1,591) 18

As reported in our consolidated financial statements $ 5,824 $ 3,553 $ 533

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Represents the combined total for our other segments as presented in Note 8.

Also includes amounts associated with our molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America copper mines and South America operations.

Includes amounts associated with our molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America copper mines and South America operations.

Molybdenum Mines Product Revenues, Production Costs and Unit Net Cash Costs

Six Months Ended June 30,

Nine Months Ended September 30,

(In millions) 2024 2023

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Reconciliation to Amounts Reported

Six months ended June 30, 2024 Revenues and Delivery DD&A

Nine Months Ended September 30, 2024 Revenues and Delivery DD&A

Totals presented above $ 434 $ 376 $ 51

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23,779 15,583 1,606

Corporate, other & eliminations (2,892) (2,763) 33

Corporate, other & eliminations c

(4,459) (4,180) 47

As reported in our consolidated financial statements $ 19,735 $ 11,796 $ 1,704

Six months ended June 30, 2023

Nine Months Ended September 30, 2023

Totals presented above $ 539 $ 308 $ 48

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21,229 14,593 1,381

Corporate, other & eliminations (3,202) (3,056) 32

Corporate, other & eliminations c

(4,799) (4,647) 50

As reported in our consolidated financial statements $ 16,950 $ 10,267 $ 1,479

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Represents the combined total for our other segments as presented in Note 8.

Also includes amounts associated with our 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.

CAUTIONARY STATEMENT

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operating plans (including mine sequencing);

PT-FI’s commissioning and ramp up of its new smelter and completion and full production at the PMR;

PT-FI’s commissioning, remediation, including expected costs, insurance recovery and timing, and ramp up of its new smelter and completion and full production at the PMR;

potential extension of PT-FI’s IUPK beyond 2041;

export licenses;

export duties;

export volumes;

export licenses, export duties and export volumes, including the ability to continue exports of copper concentrates in Indonesia until full ramp-up is achieved at PT-FI’s new downstream processing facilities, including the ability to increase the permitted export quota for 2024;

timing of shipments of inventoried production;

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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;

PT-FI’s ability to continue to export and sell copper concentrates and anode slimes through full ramp-up of its new downstream processing facilities;

PT-FI’s ability to continue to export and sell or inventory copper concentrates and anode slimes through remediation or completion, as applicable, and full ramp-up of its new downstream processing facilities;

changes in export duties;

achieving full ramp-up of new downstream processing facilities;

completion of remediation activities and achieving full ramp-up of the new smelter in Indonesia;

completion and full production at the PMR;

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mine sequencing;

changes in mine plans or operational modifications, delays, deferrals or cancellations, including the ability to smelt and refine;

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;

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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 under the heading “Risk Factors” contained in Part I, Item 1A.

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 under the heading “Risk Factors” contained in Part I, Item 1A.

of our 2023 Form 10-K.

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.

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.

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.

This report on Form 10-Q 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.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis