Bagdad Mining Complex Expansion To Increase Production To 250 Million Pounds Per Year

PHOENIX, AZ,– Freeport-McMoRan Inc (FCX). Chairman and Chief Executive Officer, Richard C. Adkerson, said, “The Company is planning an expansion to more than double the concentrator capacity of the Bagdad open-pit copper and molybdenum mining complex in northwest Arizona. Bagdad’s reserve life currently exceeds 80 years and supports an expanded operation. FCX completed technical studies in late 2023, which indicated the opportunity to construct new concentrating facilities to expand capacity from 77,000 metric tons of ore per day to between 165,000 to 185,000 metric tons of ore per day. Incremental project capital costs approximate $3.5 billion (excluding infrastructure that would be required in the long-range plans) and is expected to increase production by approximately 200-250 million pounds per year, which would more than double Bagdad’s current production. Expanded operations also are expected to provide improved efficiency and reduce unit net cash costs through economies of scale. The decision to proceed and timing of the potential expansion will take into account overall copper market conditions, availability of labor and other factors, including progress on conversion of the existing haul truck fleet to autonomous and expanding housing alternatives to support long-range plans. In parallel, the Company is advancing activities for expanded tailings infrastructure projects required under long-range plans in order to advance the potential construction timeline.”

In the fourth-quarter 2023 net income attributable to common stock of $388 million and adjusted net income attributable to common stock of $393 million, after excluding net charges totaling $5 million, primarily associated with reserves for litigation settlements, partly offset by net adjustments to reclamation liabilities and international taxes. “We enter 2024 with a focus on strong execution of our operating and investment plans, optimism on market fundamentals and a relentless drive to enhance the value of our strong portfolio of assets. Our global team achieved success during 2023 on a number of important initiatives to enhance value, advance growth options and position us for the future. During 2024, we will continue to prioritize productivity gains, operating and capital cost discipline and the advancement of organic opportunities for future long-term growth. We are dedicated to increasing the long-term value of our attractive assets, supported by the successful track record of our experienced and committed team, strong financial position and exposure to copper and other commodities with favorable long-term market fundamentals,” said Adkerson.

FCX is advancing a series of initiatives across its North America and South America operations to incorporate new applications, technologies and data analytics to its leaching processes. These leach innovation initiatives are providing opportunities to produce incremental copper from it’s large existing leach stockpiles. Initial results are providing incremental low-cost additions to the expected annual production and the potential to add to FCX’s reserve profile. The Company achieved its initial annual run rate target of approximately 200 million pounds of copper per year through these initiatives in fourth-quarter 2023 (incremental copper production from these initiatives totaled 47 million pounds in fourth-quarter 2023 and 144 million pounds for the year 2023). FCX is pursuing opportunities to apply recent operational enhancements at a larger scale and is testing new technology applications that it believes have the potential for significant increases in recoverable metal beyond the initial annual run rate target.

The fourth-quarter 2023 copper sales of 1.1 billion pounds were 3% higher than the October 2023 estimate of 1.09 billion pounds and 7% higher than fourth-quarter 2022 sales of 1.04 billion pounds. The favorable variances to the October 2023 estimate and fourth-quarter 2022 sales primarily reflect higher mining and milling rates at PT-FI. • Fourth-quarter 2023 gold sales of 549 thousand ounces were 5% lower than the October 2023 estimate of 580 thousand ounces and 20% higher than fourth-quarter 2022 sales of 458 thousand ounces. The unfavorable variance to the October 2023 estimate primarily reflects the timing of shipments associated with the resumption of anode slimes exports at PT-FI. In December PT-FI was granted its anode slimes export license and resumed exports. The favorable variance to fourth-quarter 2022 sales primarily reflects higher mining and milling rates and ore grades at PT-FI. The fourth-quarter 2023 molybdenum sales of 22 million pounds were 10% higher than the October 2023 estimate of 20 million pounds and 16% higher than fourth-quarter 2022 sales of 19 million pounds, primarily reflecting the timing of shipments. Consolidated sales volumes for the year 2024 are expected to approximate 4.1 billion pounds of copper, 2.0 million ounces of gold and 85 million pounds of molybdenum, including 1.0 billion pounds of copper, 575 thousand ounces of gold and 20 million pounds of molybdenum in first-quarter 2024. Consolidated copper production volumes for the year 2024 are expected to exceed 2024 sales volumes, reflecting the deferral of approximately 90 million pounds of copper that will be processed by the Manyar smelter and sold as refined metal in future periods. Projected sales volumes are dependent on operational performance; extension of PT-FI’s export permits for copper concentrates and anode slimes beyond May 2024; the timing of the ramp-up of the Manyar smelter and precious metals refinery (PMR) (collectively, the Indonesia smelter projects); weather-related conditions, including ongoing El Niño weather impacts; timing of shipments and other factors.

The Company has significant mineral reserves, mineral resources and future development opportunities within its portfolio of mining assets. FCX’s preliminary estimated consolidated recoverable proven and probable mineral reserves from its mines at December 31, 2023, include 104.1 billion pounds of copper, 24.5 million ounces of gold and 3.34 billion pounds of molybdenum. Recoverable mineral reserve volumes are those which FCX estimates can be economically extracted or produced at the time of the mineral reserve determination. In North America the Company operates the Morenci, Bagdad, Safford (including Lone Star), Sierrita and Miami in Arizona, and Chino and Tyrone in New Mexico. In addition to copper, certain of these mines produce molybdenum concentrate, gold and silver. All of the North America mining operations are wholly owned, except for Morenci. FCX records its 72% undivided joint venture interest in Morenci using the proportionate consolidation method. Operating and Development Activities. FCX has substantial reserves and future opportunities in the U.S., primarily associated with existing mining operations.

The Company continues to advance plans at Safford/Lone Star 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. Positive drilling conducted in recent years indicates opportunities to expand production to include 4 sulfide ores in the future. FCX is completing metallurgical testing and mine development planning and expects to commence pre-feasibility studies during 2024 for a potential significant expansion. The Company is pursuing a number of initiatives to enhance productivity and improve equipment reliability to offset declines in ore grades. It is also reviewing cost performance and evaluating the costs and benefits of adjusting mining and milling rates at Morenci. North America copper sales are estimated to approximate 1.3 billion pounds for the year 2024. FCX operates two copper mines in South America – Cerro Verde in Peru (in which FCX owns a 53.56% interest) and El Abra in Chile (in which FCX owns a 51% interest). In addition to copper, the Cerro Verde mine produces molybdenum concentrate and silver. At the El Abra operations in Chile, FCX has identified a large sulfide resource that would support a potential major mill project similar to the large-scale concentrator at Cerro Verde. Technical and economic studies continue to be evaluated to determine the optimal scope and timing for the sulfide project. The Company is evaluating water infrastructure alternatives to provide options to extend existing operations and support a future expansion, while continuing to monitor Chile’s regulatory and fiscal matters, as well as trends in capital costs for similar projects. In parallel, as part of the permitting process for the potential expansion, the Company is engaged in planning for a potential 5 submission of an environmental impact statement during 2025, subject to ongoing stakeholder engagement and economic evaluations. FCX’s consolidated production from South America mining for the year 2023 was higher than the year 2022, primarily reflecting an increase in mining rates and ore grades. FCX’s consolidated copper sales volumes from South America of 287 million pounds in fourth-quarter 2023 were lower than fourth-quarter 2022 copper sales volumes of 317 million pounds, primarily reflecting impacts at Cerro Verde associated with lower recovery rates as a result of ore types processed and slightly lower milling rates and ore grades. Projected copper sales volumes of 1.1 billion in 2024 from South America mining reflect lower ore grades at Cerro Verde, but assume no significant impacts to water availability, which is being monitored closely in light of ongoing El Niño weather patterns.

PT-FI operates one of the world’s largest copper and gold mines at the Grasberg minerals district in Central Papua, Indonesia. PT-FI produces copper concentrate that contains significant quantities of gold and silver. FCX has a 48.76% ownership interest in PT-FI and manages its mining operations. Over the past several years, the Indonesia government has enacted various laws and regulations to promote downstream processing of various products, including copper concentrates. In 2018, PT-FI agreed to expand its domestic smelting and refining capacity and has made substantial progress towards completion. At year-end 2023, progress on these projects was measured at over 90%. In July 2023, PT-FI was granted an export license for copper concentrate, and in December 2023, PT-FI was granted an export license for anode slimes, each for the export of specified quantities of concentrates and 6 slimes and valid through May 2024. PT-FI is working with the Indonesia government to obtain approvals to continue exports of copper concentrates and anode slimes subsequent to May 2024 until the Indonesia smelter projects are fully commissioned and reach designed operating conditions.

Given the long-term nature of planning for mining investments, the Indonesia government is updating regulations that would enable PT-FI to apply sooner for an extension of its IUPK beyond 2041. 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. 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), which provided production volumes of 1.7 billion pounds of copper and 2.0 million ounces of gold for the year 2023. Milling rates for ore from these underground mines averaged 214,300 metric tons of ore per day in fourth-quarter 2023, an approximate 8% increase from 198,100 metric tons of ore per day in fourthquarter 2022. PT-FI set a number of annual operating records during 2023, including total underground ore mined (and milled) and volume of concentrate produced. In December 2023, PT-FI completed the installation of new milling facilities, which will enable PT-FI to further leverage the success of the underground mines and provide sustained large-scale production volumes. PTFI is also advancing a mill recovery project with the installation of a new copper cleaner circuit that is expected to be completed in the second half of 2024 to provide incremental production of approximately 60 million pounds of copper and 40 thousand ounces of gold per year. PT-FI continues advancing plans to transition its existing energy source from coal to liquefied natural gas, which is expected to meaningfully reduce PT-FI’s Scope 1 greenhouse gas emissions at the Grasberg minerals district. PT-FI is planning investments in a new gas-fired combined cycle facility.

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. 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. Kucing Liar will benefit from substantial shared infrastructure and PT-FI’s experience and long-term success in block-cave mining.

In connection with PT-FI’s 2018 agreement with the Indonesia government to secure the extension of its long-term mining rights, PT-FI agreed to expand its domestic smelting and refining capacity. At the end of 2023, progress of the Indonesia smelter projects exceeded 90%. PT-FI is actively engaged in the following projects for additional domestic smelting and refining capacity: PT Smelting commissioned the expansion of its capacity by 30% to 1.3 million metric tons of copper concentrate per year. The project was successfully completed on time and within budget. The project was funded by PT-FI with borrowings totaling approximately $250 million that will convert to equity in mid-2024, increasing PT-FI’s ownership in PT Smelting to approximately 65% from 39.5%. Construction progress of the Manyar smelter in Gresik, Indonesia (with a capacity to process approximately 1.7 million metric tons of copper concentrate per year) is advancing on schedule with a target of May 2024 for mechanical completion, followed by a ramp-up period through December 2024. Construction of the smelter has an estimated cost of $3.0 billion, including $2.8 billion for a construction contract (excluding capitalized interest, owner’s costs and commissioning) and $0.2 billion for investment in a desalination plant. The PMR is being constructed to process gold and silver from the Manyar smelter and PT Smelting. Construction is in progress with commissioning expected during 2024. Current cost estimates total $665 million, which is approximately $90 million higher than the October 2023 estimate, reflecting updated costs for construction materials, labor and engineering. Capital expenditures for the Indonesia smelter projects totaled $1.7 billion for the year 2023 and are expected to approximate $1.0 billion for the year 2024. Capital expenditures for the Indonesia smelter projects are being funded with PT-FI’s senior notes and availability under its revolving credit facility. Operating Data. Production from the Molybdenum mines totaled 8 million pounds of molybdenum in fourth-quarter 2023 and was lower than fourth-quarter 2022 production of 10 million pounds of molybdenum, primarily reflecting lower milling rates associated with unplanned mill maintenance. FCX’s consolidated molybdenum sales and average realized prices include sales of molybdenum produced at the Molybdenum mines and at FCX’s North America and South America copper mines. Average unit net cash costs for the Molybdenum mines in fourth quarter 2023 were higher than average unit net cash costs fourth-quarter 2022, primarily reflecting lower production volumes and higher contract labor costs.