Miner Freeport-McMoRan Plans $2.5 Billion in Capital Spending in 2011

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Freeport-McMoRan Copper & Gold Incorporated (NYSE:FCX) (Phoenix, Arizona) reported net income of $1.5 billion for the first quarter of the company's 2011 fiscal year, representing a 67% rise from 1Q10 net income of $897 million.

The company benefitted from increased pricing in all three of its mined commodities:

• Copper - average realized price of $4.31 per pound, up from $3.42 per pound in 1Q10
• Gold - average realized price of $1,399 per ounce, up from $1,110 per ounce in 1Q10
• Molybdenum - average realized price of $18.10 per pound, up from $15.09 per pound in 1Q10

The company sold 926 million pounds of copper, 480,000 ounces of gold and 17 million pounds of molybdenum during the quarter. This compares to 960 million pounds of copper, 478,000 ounces of gold and 17 million pounds of molybdenum in 1Q10.

The company's capital expenditures were $505 million in the first quarter. Freeport-McMoRan anticipates capital expenditures of about $2.5 billion for the entire year. The company is in the midst of many restart and expansion projects, including the Morenci and Miami copper mines in Arizona, and a restart/revamp project for the company's molybdenum mine in Climax, Colorado.

Freeport McMoRan is also in the process of restarting the Chino copper mine near Bayard, New Mexico. The mine will produce 100 million pounds per year of copper at the end of Phase I construction in 2012. Phase II will then double the production capacity to 200 million pounds per year by 2014. Speaking of the project, Freeport-McMoRan President and CEO Richard Adkerson said, "In New Mexico, Chino Mine was our one mine that we had totally ceased operations on in 2008, and now we are restarting it. The restart will require about $150 million of cost. We will build up over time to 200 million pounds per year of copper--very attractive economics. Chino is a 100-year-plus mine, and as we keep working, we keep adding reserves, so in this environment, it's a very attractive asset for us."

Other large-scale expansions are occurring in South America, such as the company's Cerro Verde copper-molybdenum mine in Peru. Adkerson said that the company is focused on tripling the mine's production, from the current mill throughput capacity of 120,000 tons per year to 360,000 tons per year. "The feasibility study will be completed by mid-year, and then we'll be filing our environmental impact assessment. This will be one of the world's largest concentrator operations with this level of expansion," said Adkerson.

Industrial Info is tracking more than $5 billion in active Freeport-McMoRan projects across the world, including more than $1 billion in North American projects. Information on these and other projects can be found in Industrial Info's North American and International Metals & Minerals Databases.

View Project Report - 071300159 300026152

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.