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“Despite market volatility and potential economic impacts of the Coronavirus and turmoil in the global oil market, our team remains focused on the execution of our plans to enhance performance at low copper prices and provide opportunities for superior performance as market conditions improve. Copper is an essential element of the global economy and its fundamental long-term outlook remains favorable.”
Richard C. Adkerson
Vice Chairman, President and Chief Executive Officer
Freeport-McMoRan Inc. (FCX) yesterday announced its continued progress in growing copper and gold volumes by 30 – 40 percent, reducing net unit cash costs of copper by 25 percent to approximately $1.30 per pound and more than doubling cash flows by 2021 compared with 2019.
The Company remains focused on increasing volumes from its underground orebodies in Papua, Indonesia. Quarter-to-date through March 5, 2020, production from the Grasberg Block Cave and Deep MLZ orebodies averaged approximately 35,000 metric tonnes of ore per day, 35 percent above the fourth quarter 2019 average and in line with expectations.
The Lone Star project in Arizona is nearing completion and is expected to be commissioned during 2020. Leveraging innovation and technology initiatives, the company aims to enhance productivity and unit cost performance to achieve durable results.
Richard C. Adkerson, FCX’s President and Chief Executive Officer, said: “Despite market volatility and potential economic impacts of the Coronavirus and turmoil in the global oil market, our team remains focused on execution of our plans to enhance performance at low copper prices and provide opportunities for superior performance as market conditions improve. Copper is an essential element of the global economy and its fundamental long-term outlook remains favorable.”
According to the company, execution on these three important initiatives is expected to significantly enhance the Company’s cash flows in 2021 and beyond. At copper prices ranging from $2.75 – $3.00 per pound, FCX estimates free cash flow generation (net of capital expenditures and distributions to noncontrolling interests) ranging from an average of over $2 billion to nearly $3 billion per annum in 2021 and 2022.
FCX also announced that there have been no significant disruptions to its supply chain or product shipments since the outbreak of the Coronavirus. The Company continues to monitor the situation closely and will carefully manage all costs, capital expenditures and production plans during this period of uncertainty. The Company is standing on a strong liquidity position and no significant near-term debt maturities, a position that will bolster its strategic initiatives.
About Freeport MacMoran
FCX is a leading international mining company with headquarters in Phoenix, Arizona. FCX operates large, long-lived, geographically diverse assets with significant proven and probable reserves of copper, gold and molybdenum. FCX is one of the world’s largest publicly traded copper producers.
FCX’s portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and gold deposits; and significant mining operations in North America and South America, including the large-scale Morenci minerals district in Arizona and the Cerro Verde operation in Peru.