10q10k10q10k.net

What changed in Freeport-McMoRan's 10-K — 2022 vs 2023

vs

Paragraph-level year-over-year comparison of Freeport-McMoRan's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+636 added−634 removedSource: 10-K (2024-02-16) vs 10-K (2023-02-15)

Top changes in Freeport-McMoRan's 2023 10-K

636 paragraphs added · 634 removed · 492 edited across 5 sections

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

204 edited+54 added−42 removed97 unchanged
Biggest changeOperational risks Our mining operations are subject to operational risks that could adversely affect our business and our underground mining operations have higher risks than a surface mine. We have assets in a variety of geographic locations, all of which exist in and around broader communities and environments.
Biggest changeWe cannot predict whether the regulations will be updated or that PT-FI will be successful in applying for the extension of its IUPK beyond 2041. Operational risks Our mining operations are subject to operational risks that could adversely affect our business, including the ability to smelt and refine, and our underground mining operations have higher risks than a surface mine.
Volatility in global economic growth, particularly in developing economies, has the potential to adversely affect future demand and prices for commodities. Geopolitical uncertainty and protectionism, have the potential to inhibit international trade and negatively impact business confidence, which creates the risk of constraints on our ability to trade in certain markets and has the potential to increase price volatility.
Volatility in global economic growth, particularly in developing economies, has the potential to affect adversely future demand and prices for commodities. Geopolitical uncertainty and protectionism have the potential to inhibit international trade and negatively impact business confidence, which creates the risk of constraints on our ability to trade in certain markets and has the potential to increase price volatility.
Additionally, if the transportation service providers fail to deliver consumables or components used in our operations to us or the commodities we produce to our customers in a timely manner or at all, such failure could adversely impact our ability to meet our production schedules, delay our projects and capital initiatives, negatively affect our customer relationships and have a material adverse effect on our financial position and results of operations.
Additionally, if transportation service providers fail to deliver consumables or components used in our operations to us or the commodities we produce to our customers in a timely manner or at all, such failure could adversely impact our ability to meet our production schedules, delay our projects and capital initiatives, negatively affect our customer relationships and have a material adverse effect on our financial position and results of operations.
Our level of indebtedness and other financial commitments could have important consequences to our business, including the following: • Limiting our flexibility in planning for, or reacting to, changes in the industry in which we operate; • Increasing our vulnerability to general adverse economic, industry and regulatory conditions; • Limiting our ability to fund future working capital, capital expenditures, general corporate requirements and/or material contingencies, to engage in future development activities, or to otherwise realize the value of our assets and opportunities fully because of the need to dedicate a substantial portion of our cash flows from operations to payments on our debt; • Requiring us to sell assets to reduce debt; or • Placing us at a competitive disadvantage compared to our competitors that have less debt and/or fewer financial commitments.
Our level of indebtedness and other financial commitments could have important consequences to our business, including the following: • Limiting our flexibility in planning for, or reacting to, changes in the industry in which we operate; • Increasing our vulnerability to general adverse economic, industry and regulatory conditions; • Limiting our ability to fund future working capital, capital expenditures, general corporate requirements and/or material contingencies, to engage in future development activities or other business opportunities, or to otherwise realize the value of our assets and opportunities fully because of the need to dedicate a substantial portion of our cash flows from operations to payments on our debt; • Requiring us to sell assets to reduce debt; or • Placing us at a competitive disadvantage compared to our competitors that have less debt and/or fewer financial commitments.
Some of our tailings storage facilities are located in areas where a failure has the potential to impact individual dwellings and a limited number of impoundments are in areas where a failure has the potential to impact nearby communities or mining infrastructure.
Some of our tailings storage facilities are located in areas where a failure has the potential to impact individual dwellings and a limited number of our impoundments are in areas where a failure has the potential to impact nearby communities or mining infrastructure.
Our operations are subject to extensive and complex laws and regulations, including environmental laws and regulations governing the generation, storage, treatment, transportation and disposal of hazardous substances; solid waste disposal; air emissions; wastewater discharges; remediation, restoration and reclamation of environmental contamination, including mine closures and reclamation; protection of endangered and threatened species and designation of critical habitats; and other related matters.
Our operations are subject to extensive and complex environmental laws and regulations governing the generation, storage, treatment, transportation and disposal of hazardous substances; solid waste disposal; air emissions; wastewater discharges; remediation, restoration and reclamation of environmental contamination, including mine closures and reclamation; protection of endangered and threatened species and designation of critical habitats; and other related matters.
The transition to renewable and other energy sources could, among other things, increase our capital expenditures, operating and energy costs, depending on the scope, magnitude and timing of increased regulation of fossil-fuel based energy production, including GHG emissions, as well as the availability of alternative energy sources.
The transition to renewable and other energy sources could, among other things, increase our capital expenditures, and operating and energy costs, depending on the scope, magnitude and timing of increased regulation of fossil-fuel based energy production, including GHG emissions, as well as the availability of alternative energy sources.
These operational risks, which could materially and adversely affect our business, operating results and cash flows, include earthquakes, rainstorms, floods, wildfires and other natural disasters; environmental hazards, including discharge of metals, concentrates, pollutants or hazardous chemicals; surface or underground fires; equipment failures; accidents, including in connection with mining equipment, milling equipment or conveyor systems, transportation of chemicals, explosives or other materials and in the transportation of employees and other individuals to and from sites (including where these services are provided by third parties such as vehicle and aircraft transport); wall failures and rock slides in our open-pit mines, and structural collapses of our underground mines or tailings impoundments; underground water and ore management; 56 lower than expected ore grades or recovery rates; and seismic activity resulting from unexpected or difficult geological formations or conditions (whether in mineral or gaseous form).
These operational risks, which could materially adversely affect our business, operating results and cash flows, include earthquakes, rainstorms, floods, wildfires and other natural disasters; environmental hazards, including discharge of metals, concentrates, pollutants or hazardous chemicals; surface or underground fires; equipment failures; accidents, including in connection with mining equipment, milling equipment or conveyor systems, transportation of chemicals, explosives or other materials and in the transportation of employees and other individuals to and from sites (including where these services are provided by third parties such as vehicle and aircraft transport); wall failures and rock slides in our open-pit mines, and structural collapses of our underground mines or tailings impoundments; underground water and ore management; lower than expected ore grades or recovery rates; and seismic activity resulting from unexpected or difficult geological formations or conditions (whether in mineral or gaseous form).
As a global business, we are subject to income, royalty, transaction and other taxes in the U.S. and various foreign jurisdictions. Uncertainties exist with respect to our tax liabilities, including those arising from changes in laws in the countries in which we do business. We have significant net operating losses (NOLs) in the U.S. generated in prior years.
As a global business, we are subject to income, royalty, transaction and other taxes in the U.S. and various foreign jurisdictions. Uncertainties exist with respect to our tax liabilities, including those arising from changes in laws in the jurisdictions in which we do business. We have significant net operating losses (NOLs) in the U.S. generated in prior years.
Such potential physical impacts of climate change on our operations are highly uncertain, and would vary by operation based on particular geographic circumstances. At many of our mine sites, climate change is projected to impact local precipitation regimes, resulting in shorter-duration, higher-intensity storm events, and the potential for less precipitation overall.
Such potential physical impacts of climate change on our operations are highly uncertain and would vary by operation based on particular geographic circumstances. For example, at many of our mine sites, climate change is projected to impact local precipitation regimes, resulting in shorter-duration, higher-intensity storm events, and the potential for less precipitation overall.
There were several shooting incidents in the first half of 2020, including an incident near a PT-FI office building where one employee was killed and two others injured. In January 2021, a helicopter contracted to PT-FI was fired upon and struck by a single gunshot in an area adjacent to the project area.
During the first half of 2020, there were several shooting incidents, including an incident near a PT-FI office building where one employee was killed and two others injured. In January 2021, a helicopter contracted by PT-FI was fired upon and struck by a single gunshot in an area adjacent to the project area.
In 2022, the Indonesia government divided the Indonesia portion of the island of New Guinea from two provinces into a total of six provinces, which has resulted in public protest and civil unrest. For further discussion of violence, civil and religious strife, and activism affecting our operations in Indonesia, see the related risk factor below.
Beginning in 2022, the Indonesia government divided the Indonesia portion of the island of New Guinea from two provinces into a total of six provinces, which has resulted in public protest and civil unrest. For further discussion of violence, civil and religious strife, and activism affecting our operations in Indonesia, see the related risk factor below.
We undertake no obligation to update any forward-looking statements, which speak only as of the date made. We caution readers that forward-looking statements are not guarantees of future performance and our actual results may differ materially from those anticipated, expected, projected or assumed in the forward-looking statements.
We undertake no obligation to update any forward-looking statements, which speak only as of the date made. 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.
Our inability to enforce our right and the enforcement of rights on a prejudicial basis by foreign courts or arbitral panels, including against a sovereign nation, could have an adverse effect on our results of operations and financial position. Changes in tax laws and regulations could have a material adverse effect on our financial condition.
Our inability to enforce our rights and the enforcement of rights on a prejudicial basis by foreign courts or arbitral panels, including against a sovereign nation, could have an adverse effect on our results of operations and financial position. Changes in tax laws and regulations could have a material adverse effect on our financial condition.
Although each of our mining operations currently has access to sufficient water supplies to support current operational demands, as discussed above, the availability of additional supplies for potential future expansions or development will require additional investments and will take time to develop, if available.
Although each of our mining operations currently has access to sufficient water sources to support current operational demands, as discussed above, the availability of additional supplies for potential future expansions or development will require additional investments and will take time to develop, if available.
The waste rock (including overburden) and tailings produced in our mining operations represent our largest volume of waste material. Managing the volume of waste rock and tailings presents significant environmental, safety and engineering challenges and risks primarily relating to structural stability, geochemistry, water quality and dust generation.
The waste rock (including overburden) and tailings produced in our mining operations represent our largest volume of mine waste material. Managing the volume of waste rock and tailings presents significant environmental, safety and engineering challenges and risks primarily relating to structural stability, geochemistry, water quality and dust generation.
For example, in mid-March 2020, we had to temporarily transition our Cerro Verde mine to care and maintenance status and adjust operations to prioritize critical activities in response to a decree issued by the Peru government relating to COVID-19.
For example, in March 2020, we had to temporarily transition our Cerro Verde mine to care and maintenance status and adjust operations to prioritize critical activities in response to a decree issued by the Peru government relating to COVID-19.
In addition, we or our subsidiaries may incur additional debt in future periods or reduce our holdings of cash and cash equivalents in connection with funding existing operations, capital expenditures, dividends, share or debt repurchases, or in pursuing other business opportunities.
In addition, we (including our subsidiaries) may incur additional debt in future periods or reduce our holdings of cash and cash equivalents in connection with funding existing operations, capital expenditures, dividends, share or debt repurchases, or in pursuing other business opportunities.
The occurrence of one or more of these events in connection with our exploration activities and development of and production from mining operations may result in the death of, or personal injury to, our employees, other personnel or third parties, the loss of mining equipment, damage to or destruction of mineral properties or production facilities, significant repair costs, monetary losses, deferral or unanticipated fluctuations in production, extensive community disruption (including short- and long-term health and safety risks), loss of licenses, permits or necessary approvals to operate, loss of workforce confidence, loss of infrastructure and services, disruption to essential supplies or delivery of our products, environmental damage and potential legal liabilities, all of which may adversely affect our reputation, business, prospects, results of operations and financial position.
The occurrence of one or more of these events in connection with our exploration activities and development of and production from mining operations may result in the death of, or personal injury or illness to, our employees, other personnel or third parties, the loss of mining equipment, damage to or destruction of mineral properties or production facilities, significant repair costs, monetary losses, deferral or unanticipated fluctuations in production, extensive community disruption (including short- and long-term health and safety risks), loss of licenses, permits or necessary approvals to operate, loss of workforce confidence, loss of infrastructure and services, disruption to essential supplies or delivery of our products, environmental damage and potential legal liabilities, any of which may adversely affect our reputation, business, prospects, results of operations and financial position.
In addition, the Grasberg overburden stockpiles have experienced erosion over time, caused by the large amounts of rainfall, with the eroded stockpile material eventually entering into the lowlands tailings management area.
In addition, the Grasberg overburden stockpiles experienced erosion over time, caused by the large amounts of rainfall, with the eroded stockpile material eventually entering into the lowlands tailings management area.
Additionally, if we enter into a new labor agreement with any union that significantly increases our labor costs relative to our competitors, our ability to compete may be materially and adversely affected.
Additionally, if we enter into a new labor agreement with any union that significantly increases our labor costs relative to our competitors, our ability to compete may be materially adversely affected.
We could also be adversely affected by system or network disruptions if new or upgraded information technology systems are defective, not installed properly or not properly integrated into our operations.
We could also be adversely affected by system or network disruptions if new or upgraded information or operational technology systems are defective, not installed properly or not properly integrated into our operations.
In addition, new laws and regulations, including executive orders, 65 or changes to or new interpretations of existing laws and regulations by courts or regulatory authorities occur regularly, but are difficult to predict.
In addition, new laws and regulations, including executive orders, or changes to or new interpretations of existing laws and regulations by courts or regulatory authorities occur regularly, but are difficult to predict.
Levees have been constructed along both sides of the lowlands tailings 58 management area to act as containment structures to laterally contain the footprint of the tailings deposition within the approved tailings management area.
Levees have been constructed along both sides of the lowlands tailings management area to act as containment structures to laterally contain the footprint of the tailings deposition within the approved tailings management area.
Because our mining operations in Indonesia are a significant operating asset, our business may be adversely affected by political, economic and social uncertainties in Indonesia.
Because our mining operations in Indonesia are a significant operating asset, our business may be adversely affected by political, economic, regulatory and social uncertainties in Indonesia.
We recognize that as the climate changes, our operations, workforce, communities, supply chains and customers may be exposed to changes in the frequency, intensity and/or duration of intense storms, drought, flooding (including from sea level rise at our coastal operations), wildfire, and other extreme weather events and patterns (such as extreme heat).
We recognize that as the climate changes, our operations, workforce, communities, biodiversity and ecosystems, supply chains and customers may be exposed to changes in the frequency, intensity and/or duration of intense storms, drought, flooding (including from sea level rise at our coastal operations), wildfire, and other extreme weather events and patterns (such as extreme heat).
We are also involved periodically in other reviews, inquiries, investigations and other proceedings initiated by or involving government agencies, some of which may result in adverse judgments, settlements, fines, penalties, injunctions or other relief. From time to time we are involved in disputes over the allocation of environmental remediation obligations at “Superfund” and other sites.
“Legal Proceedings.” We are also involved periodically in other reviews, inquiries, investigations and other proceedings initiated by or involving government agencies, some of which may result in adverse judgments, settlements, fines, penalties, injunctions or other relief. From time to time we are involved in disputes over the allocation of environmental remediation obligations at “Superfund” and other sites.
We recognize that access to clean, safe and reliable water supplies is vital to the health and livelihood of our host communities. Our mining operations require physical availability and secure legal rights to significant quantities of water, and the increasing pressure on water resources requires us to consider both current and future conditions in our approach.
We recognize that access to clean, safe and reliable water supplies is vital to the health and livelihood of our host communities. Our mining operations require physical availability and secure legal rights to significant quantities of water, and the increasing pressure on water sources requires us to consider both current and future conditions in our approach.
Overtopping or failure of any tailings containment structures (levees or protection structures) induced by extreme weather events such as floods, a major seismic event or naturally-occurring weak ground under the structures, are potential risks. The potential impacts from any such occurrence could vary significantly depending upon the specific location of the failure.
Overtopping or failure of any of the PT-FI tailings containment structures (levees or protection structures) induced by extreme weather events such as floods, a major seismic event or naturally-occurring weak ground under the structures, are potential risks. The potential impacts from any such occurrence could vary significantly depending upon the specific location of the failure.
We aim to balance our operational water requirements with those of the local communities, environment and ecosystems. Most of our North America and South America mining operations are in areas where competition for water supplies is significant, and where climate change may lead to increasing scarcity of water resources in the future.
We aim to balance our operational water requirements with those of the local communities, environment and ecosystems. Most of our North America and South America mining operations are in areas where competition for water supplies is significant, and where climate change may lead to increasing scarcity of water sources in the future.
Failure to effectively engage with communities on an ongoing basis, including the withdrawal of consent or support of Indigenous Peoples, or other stakeholders, could adversely impact our business, damage our reputation and/or result in loss of rights to explore, operate or develop our projects.
Failure to effectively engage with communities on an ongoing basis, including the withdrawal of consent or support of Indigenous Peoples, other stakeholders or other third parties, could adversely impact our business, damage our reputation and/or result in loss of rights to explore, operate or develop our projects.
We have a large number of contracts with local and foreign suppliers and contractors, who may take action contrary to or fail to adopt standards, controls and procedures, including health, safety, environment, human rights and community standards that are equivalent to our standards, controls and procedures.
We have a large number of contracts with local and foreign business partners, including suppliers and contractors, who may take action contrary to or fail to adopt standards, controls and procedures, including health, safety, environment, human rights and community standards that are equivalent to our standards, controls and procedures.
A reduction or suspension in our dividend payments or share repurchases could have a negative effect on the price of our common stock. 69 Anti-takeover provisions in our charter documents and Delaware law may make an acquisition of us more difficult. Anti-takeover provisions in our charter documents and Delaware law may make an acquisition of us more difficult.
A reduction or suspension in our dividend payments or share repurchases could have a negative effect on the price of our common stock. 69 Table of Contents Anti-takeover provisions in our charter documents and Delaware law may make an acquisition of us more difficult.
Regulatory, environmental and social risks • Compliance with applicable environmental, health and safety laws and regulations; • Remediation of properties no longer in operation; • Ability to meet our energy requirements while complying with climate-related regulations and expectations and other energy transition policy changes; • The physical impacts of climate change on our operations, workforce, communities, supply chains and customers; • Increasing scrutiny, action and evolving expectations from stakeholders with respect to our environmental, social and governance (ESG) practices, performance, commitments and disclosures; and • Failure or perceived failure to manage relationships with the communities and/or Indigenous Peoples where we operate or that are near our operations.
Regulatory, environmental and social risks • Compliance with applicable environmental, health and safety laws and regulations; • Remediation of properties no longer in operation; • Ability to meet our energy requirements while complying with climate-related regulations and expectations and other energy transition policy changes; • The physical impacts of climate change on our operations, workforce, communities, biodiversity and ecosystems, supply chains and customers; • Increasing scrutiny, action and evolving expectations from stakeholders and other third parties with respect to our environmental, social and governance (ESG) practices, performance, commitments and disclosures; and • Failure or perceived failure to manage relationships with the communities and/or Indigenous Peoples where we operate or that are near our operations.
That liability is often asserted on a joint and several basis with other prior and subsequent owners, operators and arrangers, meaning that each owner or operator of the property is, and each arranger may be, held fully responsible for the remediation, although in many cases some or all of the other responsible parties no longer exist, do not have the financial ability to respond or cannot be found.
That liability is often asserted on a joint and several basis with other prior and subsequent owners, operators and arrangers, meaning that each owner or operator of the property is, and each arranger may be, held fully responsible for the remediation, although in many cases some or all of the other responsible parties no longer exist, do not have 65 Table of Contents the financial ability to respond or cannot be found.
Existing and proposed governmental conventions, laws, rules, regulations, policies and standards as well as existing and proposed voluntary disclosure standards and frameworks (both in the U.S. and internationally), including those related to climate and greenhouse gas (GHG) emissions, may in the future add significantly to our operating costs, limit or modify our operations, impact the competitiveness of the commodities we produce, and require more resources to comply and remediate in response.
Existing and proposed governmental conventions, laws, rules, regulations, policies and standards as well as existing and proposed voluntary disclosure standards and frameworks (both in the U.S. and internationally), including those related to climate change, carbon taxes or greenhouse gas (GHG) emissions, may in the future add significantly to our operating costs, limit or modify our operations, impact the competitiveness of the commodities we produce, and require more resources to comply and remediate in response.
In particular, the enactment of Law No. 4 of 2009 on Coal and Mineral Mining on January 12, 2009 (the Mining Law) replaced the previous regulatory framework which allowed concession holders, 54 including PT-FI, to conduct mining activities in Indonesia under a contract of work system.
The enactment of Law No. 4 of 2009 on Coal and Mineral Mining on January 12, 2009 (the Mining Law) replaced the previous regulatory framework which allowed concession holders, including PT-FI, to conduct mining activities in Indonesia under a contract of work system.
Our ability to continue to pay dividends (base or variable) and the timing and amount of any share repurchases is at the discretion of our Board and management, respectively, and is subject to a number of factors, including maintaining our net debt target, capital availability, our financial results, cash requirements, global economic conditions, changes in laws, contractual restrictions and other factors deemed relevant by our Board or management, as applicable.
Our ability to continue to pay dividends (base or variable) and the timing and amount of any share repurchases is at the discretion of our Board and management, respectively, and is subject to a number of factors, including not exceeding our net debt target, capital availability, our financial results, cash requirements, global economic conditions, changes in laws, contractual restrictions and other factors deemed relevant by our Board or management, as applicable.
Forward-looking statements are all statements other than statements of historical facts, such as plans, projections, or expectations relating to business outlook, strategy, goals or targets; global market conditions; ore grades and milling rates; production and sales volumes; unit net cash costs and operating costs; capital expenditures; operating plans; cash flows; liquidity; PT Freeport Indonesia’s (PT-FI) financing, construction and completion of additional domestic smelting capacity in Indonesia in accordance with the terms of its special mining license (IUPK); extension of PT-FI’s IUPK beyond 2041; our commitments to deliver responsibly produced copper and molybdenum, including plans to implement, validate and maintain validation of our operating sites under specific frameworks; execution of our energy and climate strategies and the underlying assumptions and estimated impacts on our business related thereto; achievement of 2030 climate targets and 2050 net zero aspiration; improvements in operating procedures and technology innovations; exploration efforts and results; development and production activities, rates and costs; future organic growth opportunities; tax rates; export quotas and duties; the impact of copper, gold and molybdenum price changes; the impact of deferred intercompany profits on earnings; mineral reserve and mineral resource estimates; final resolution of settlements associated with ongoing legal proceedings; debt repurchases and the ongoing implementation of our financial policy and future returns to shareholders, including dividend payments (base or variable) and share repurchases.
Forward-looking statements are all statements other than statements of historical facts, such as plans, projections, or expectations relating to business outlook, strategy, goals or targets; global market conditions; ore grades and milling rates; production and sales volumes; unit net cash costs and operating costs; capital expenditures; operating plans; cash flows; liquidity; PT Freeport Indonesia’s (PT-FI) construction and completion of additional domestic smelting and refining capacity in Indonesia in accordance with the terms of its special mining license (IUPK); extension of PT-FI’s IUPK beyond 2041; export licenses; export duties; export volumes; our commitment to deliver responsibly produced copper and molybdenum, including plans to implement, validate and maintain validation of our operating sites under specific frameworks; execution of our energy and climate strategies and the underlying assumptions and estimated impacts on our business and stakeholders related thereto; achievement of 2030 climate targets and 2050 net zero aspiration; improvements in operating procedures and technology innovations and applications; exploration efforts and results; development and production activities, rates and costs; future organic growth opportunities; tax rates; the impact of copper, gold and molybdenum price changes; the impact of deferred intercompany profits on earnings; mineral reserve and mineral resource estimates; final resolution of settlements associated with ongoing legal and environmental proceedings; debt repurchases; and the ongoing implementation of our financial policy and future returns to shareholders, including dividend payments (base or variable) and share repurchases.
The adoption and expansion of trade restrictions, changes in China-U.S. relations, or other governmental action related to tariffs or trade agreements or policies are difficult to predict and could adversely affect copper prices, demand for our products, our costs, our customers, our suppliers, and the U.S. economy, which in turn could have a material adverse effect on our business, results of operations or financial condition.
The adoption and expansion of trade restrictions, or other governmental action related to tariffs or trade agreements or policies are difficult to predict and could adversely affect copper prices, demand for our products, our costs, our customers, our suppliers and the U.S. economy, which in turn could have a material adverse effect on our business, results of operations or financial condition.
Our Indonesia mining operations are susceptible to difficult and costly environmental challenges, and future changes in Indonesia environmental laws could increase our costs. Mining operations on the scale of our Indonesia operations involve significant environmental risks and challenges. Our primary challenge is to dispose of the large amount of tailings.
Our Indonesia mining operations are susceptible to difficult and costly environmental challenges, and future changes in Indonesia environmental laws could increase our costs. Mining operations on the scale of our Indonesia operations involve significant environmental risks and challenges. Our primary challenge is to dispose of the large volume of tailings.
There can be no assurance that unanticipated geotechnical and hydrological conditions may or may not occur, nor whether these conditions may lead to events such as landslides and pit wall failures, in the future or that such events will be detected in advance.
There can be no assurance that unanticipated geotechnical and hydrological conditions may not occur, nor whether these conditions may lead to events such as landslides and pit wall failures, or that such events will be detected in advance.
As of January 31, 2023, subsidiaries of our company currently operate 15 active tailings storage facilities (13 in the U.S. and 2 in Peru), of which 10 have an upstream design and 5 have a centerline design.
As of January 31, 2024, subsidiaries of our company currently operate 15 active tailings storage facilities (13 in the U.S. and 2 in Peru), of which 10 have an upstream design and 5 have a centerline design.
Risks of conducting business in countries outside the U.S. can include: • Delays in obtaining or renewing, or the inability to obtain, maintain or renew, or the renegotiation, cancellation, revocation or forced modification (including the inherent risk of these actions being taken unilaterally by government owned entities) of contracts, leases, licenses, permits, stability agreements or other agreements and/or approvals; • Expropriation or nationalization of property, protectionism, or restrictions on repatriation of earnings or capital; • Changes in and differing interpretations of the host country’s laws, regulations and policies (which may be applied retroactively), including, but not limited to, those relating to labor, taxation, royalties, duties, tariffs, divestment, imports, exports (including restrictions on the export of copper concentrate and anode slimes, copper and/or gold), trade regulations, immigration, currency, human rights and environmental matters (including land use and water use), additional requirements on foreign operations and investment, and/or fines, fees and sanctions imposed for failure to comply with the laws and regulations of the jurisdictions in which we operate, the risk of any of which may increase with rising “resource nationalism” in countries around the world; • Geopolitical events, social and economic instability, bribery, extortion, corruption, civil unrest, blockades, acts of war, guerrilla activities, insurrection and terrorism, certain of which may result in, among other things, an inability to access our property or transport our commodities; • Risk of loss associated with trespass, illegal artisanal mining, theft, sabotage and vandalism; 53 • Changes in U.S. trade, tariff, tax, immigration or other policies that may impact relations with foreign countries or result in retaliatory policies; • Increases in training and other costs and challenges relating to requirements by governmental entities to employ nationals of a country in which a particular operation is located; • Foreign exchange controls and fluctuations in foreign currency exchange rates; • Reduced protection for intellectual property rights; and • The risk of having to submit to the jurisdiction of an international court or arbitration panel or having to enforce the judgment of an international court or arbitration panel against a sovereign nation within its own territory.
Risks of conducting business in countries outside the U.S. can include: • Delays in obtaining or renewing, or the inability to obtain, maintain or renew, or the renegotiation, cancellation, revocation or forced modification (including the inherent risk of these actions being taken unilaterally by the foreign government or government owned entities) of contracts, leases, licenses, permits, stability agreements or other agreements and/or approvals; • Expropriation or nationalization of property, protectionism, or restrictions on repatriation of earnings or capital; • Changes in and differing interpretations of the host country’s laws, regulations and policies (which may be applied retroactively), including, but not limited to, those relating to labor, taxation, royalties, duties, tariffs, licenses, divestment, imports, exports (including restrictions on the export of copper concentrates and anode slimes, copper and/or gold), trade laws and regulations, immigration, currency, human rights and environmental matters (including land use and water use), additional requirements on foreign operations and investment, and/or fines, fees and sanctions, criminal liability and other penalties imposed for failure to comply with the laws and regulations of the U.S. and the other jurisdictions in which we operate, the risk of any of which may increase with rising “resource nationalism” in countries around the world; 52 Table of Contents • Geopolitical events, social and economic instability, bribery, extortion, corruption, civil unrest, blockades, acts of war, guerrilla activities, insurrection and terrorism, certain of which may result in, among other things, an inability to access our property or transport our commodities; • Risk of loss associated with illegal activity, including trespass, illegal artisanal mining, theft (including piracy), sabotage (including of critical infrastructure) and vandalism; • Changes in U.S. trade, tariff, tax, immigration or other policies that may impact relations with foreign countries or result in retaliatory policies; • Increases in training and other costs and challenges relating to requirements by governmental entities to employ nationals of a country in which a particular operation is located; • Foreign exchange controls and fluctuations in foreign currency exchange rates; • Reduced protection for intellectual property rights; and • The risk of having to submit to the jurisdiction of an international court or arbitration panel or having to enforce the judgment of an international court or arbitration panel against a sovereign nation within its own territory.
System modification failures could have a material adverse effect on our business, financial position and results of operations and could, if not successfully implemented, adversely impact the effectiveness of our internal controls over financial reporting.
System modification failures could have a material adverse effect on our business, financial position and results of operations and could, if not successfully implemented, adversely impact the effectiveness of our internal control over financial reporting.
Further, we increasingly depend on our information technology infrastructure for electronic communications among our locations, personnel, customers and suppliers around the world, including as a result of remote working and flexible working arrangements.
Further, we increasingly depend on our information technology infrastructure for electronic communications among our operations, personnel, customers and suppliers around the world, including as a result of remote working and flexible working arrangements.
“Legal Proceedings,” in Arizona, where our operations use both surface water and groundwater, we are a participant in an active adjudication in which Arizona courts have been attempting, for over 45 years, to quantify and prioritize surface water claims for the Gila River watershed, one of the state’s largest river systems.
“Legal Proceedings,” in Arizona, where our operations use both surface water and groundwater, we are a participant in an active adjudication in which Arizona courts have been attempting, for 50 years, to quantify and prioritize surface water claims for the Gila River watershed, one of the state’s largest river systems.
Significant reductions in productivity or protracted work stoppages at one or more of our operations could significantly reduce our production and sales volumes or disrupt operations, which could adversely affect our cash flows, results of operations and financial condition. Our success depends on our ability to recruit, retain, develop and advance qualified personnel.
Significant reductions in productivity or protracted work stoppages at one or more of our operations could significantly reduce our production and sales volumes or disrupt operations, which could adversely affect our cash flows, results of operations and financial condition. 62 Table of Contents Our success depends on our ability to recruit, retain, develop and advance qualified personnel.
If we do not adapt to or comply with investor or stakeholder expectations, including with respect to evolving ESG disclosure standards and frameworks, or if we are perceived to have not responded appropriately, regardless of whether there is a legal requirement to do so, we may suffer from reputational damage and our business, financial condition, cost of capital and/or stock price could be materially and adversely affected.
If we do not adapt to or comply with stakeholder or other third parties expectations, including with respect to evolving ESG disclosure standards and frameworks, or if we are perceived to have not responded appropriately, regardless of whether there is a legal requirement to do so, we may suffer from reputational damage and our business, financial condition, cost of capital and/or stock price could be materially adversely affected.
Changes in the aspirations and expectations of local communities and/or Indigenous Peoples where we operate, with respect to our employee health and safety performance and our contributions to infrastructure, community development, environmental management and other factors could affect our social license to operate and reputation, and could lead to delays and/or increased costs if expansions or new projects are blocked either temporarily or for extended periods.
Changes in the aspirations and expectations of local communities and/or Indigenous Peoples where we operate, with respect to our employee health and safety performance and our contributions to infrastructure, community development, environmental management, including land management and associated biodiversity, and other factors could affect our social license to operate and reputation, and could lead to delays and/or increased costs if expansions or new projects are blocked either temporarily or for extended periods.
In addition, our customers and end users may require that we implement certain additional ESG procedures or standards before they will start or continue to do business with us, which could lead to preferential buying based on our ESG practices compared to our competitors’ ESG practices.
In addition, our customers, end users and other third parties may require that we implement certain additional ESG procedures or standards before they will start or continue to do business with us, which could lead to preferential buying based on our ESG practices compared to our competitors’ ESG practices.
For example, our operations may take place on or adjacent to Indigenous Peoples’ ancestral lands, and such Indigenous Peoples may assert rights to the lands where we operate. Further, we may be required or expected by our stakeholders to consult with and/or obtain consent from Indigenous Peoples with respect to these operations.
For example, our operations may take place on or adjacent to Indigenous Peoples’ ancestral lands, and such Indigenous Peoples may assert rights to the lands where we operate. Further, we may be required or expected by our stakeholders and other third parties to consult with and/or obtain consent from Indigenous Peoples with respect to these operations.
If we are unable to maintain our indebtedness and financial ratios at levels acceptable to these credit rating agencies, or should our business prospects deteriorate, our current credit ratings could be downgraded, which could adversely 51 affect the value of our outstanding securities and existing debt, our ability to obtain new financing on favorable terms and could increase our borrowing costs.
If 50 Table of Contents we are unable to maintain our indebtedness and financial ratios at levels acceptable to these credit rating agencies, or should our business prospects deteriorate, our current credit ratings could be downgraded, which could adversely affect the value of our outstanding securities and existing debt, our ability to obtain new financing on favorable terms and could increase our borrowing costs.
Plans and provisions for mine closure and remediation may change over time as a result of changes in stakeholder expectations, legislation, standards, and technical understanding and techniques, which may cause our actual costs of closure and remediation to be higher than estimated for environmental and asset retirement obligations (AROs) and could materially affect our financial position or results of operations.
Plans and provisions for mine closure, reclamation and remediation may change over time as a result of changes in stakeholder and other third-party expectations, legislation, standards, and technical understanding and techniques, which may cause our actual costs of closure, reclamation and remediation to be higher than estimated for asset retirement obligations (AROs) and environmental obligations and could materially affect our financial position or results of operations.
The agreement to pump from this aquifer is subject to continued monitoring through 2029 of the aquifer water levels and select flora species to ensure that environmentally sensitive areas are not impacted by our pumping. If impact occurs, reductions in pumping are required to restore water levels, which could have an adverse effect on production from El Abra.
The agreement to pump from this aquifer is subject to continued monitoring through 2029 of the aquifer water levels and select flora species to ensure that environmentally sensitive areas are not impacted by our pumping, which if impacted could cause reductions in pumping to restore water levels and could have an adverse effect on production from El Abra.
As a result, PT-FI will not mine all of these mineral reserves during the initial term of the IUPK. Prior to the end of 2031, we expect to mine 46% of aggregate proven and probable recoverable mineral reserves at December 31, 2022, representing approximately half of our net equity share of recoverable copper and gold reserves.
As a result, PT-FI will not mine all of these mineral reserves during the initial term of the IUPK. Prior to the end of 2031, we expect to mine 43% of aggregate proven and probable recoverable mineral reserves at December 31, 2023, representing approximately half of our net equity share of recoverable copper and gold reserves.
For further information, see the risk factors below relating to mine closure and reclamation regulations and the increasing scrutiny and evolving expectations from stakeholders, including creditors, with respect to our ESG practices, performance and disclosures.
For further information, see the risk factors below relating to mine closure and reclamation regulations and the increasing scrutiny and evolving expectations from stakeholders and other third parties, including creditors, with respect to our ESG practices, performance and disclosures.
Under certain conditions, a failure may necessitate evacuation or relocation of communities or other emergency action, financial assistance to the communities impacted, and remediation costs to repair and compensate for the social, cultural and economic impacts.
Under certain conditions, a failure may necessitate evacuation or relocation of communities or other emergency action, financial assistance to the communities impacted, and remediation costs to repair and compensate for the social, cultural and economic impacts associated with such failure.
For example, our diesel-fueled haul trucks are a significant contributor to GHG emissions at our North America and South America operations, but reduction of emissions from such haul trucks will depend upon the development and availability of commercially viable alternative-fueled mining equipment by our third-party suppliers.
For example, our diesel-fueled haul trucks are a significant contributor to GHG emissions at our North America and South America operations. We are evaluating options for the electrification of our haul trucks, but reduction of emissions from such haul trucks will depend upon the development and availability of commercially viable alternative-fueled mining equipment by our third-party suppliers.
In addition to the factors discussed above, copper prices may be affected by demand from China, which is currently the largest consumer of refined copper in the world, including as a result of geopolitical uncertainty between the U.S. and China as well as uncertainties about China’s economy, including its COVID-19 policies.
In addition to the factors discussed above, copper prices may be affected by demand from China, which is currently the largest consumer of refined copper in the world, including as a result of geopolitical uncertainty between the U.S. and China as well as uncertainties about China’s economy.
Continuous production at our mines and any future expansions or developments are dependent on many factors, including our ability to maintain our water rights and claims, and the continuing physical availability of the water supplies.
Continuous production at our mines and any future expansions or developments are 59 Table of Contents dependent on many factors, including our ability to maintain our water rights and claims, and the continuing physical availability of the water supplies.
We experience mining induced seismic activity, including landslides, from time to time in the Grasberg minerals district. The mine site is also in an active seismic area and has experienced earth tremors from time to time.
We also experience mining induced seismic activity, including landslides, from time to time in the Grasberg minerals district in addition to severe weather. The mine site is in an active seismic area and has experienced earth tremors from time to time.
Prices and availability of consumables used in our operations, such as natural gas, diesel, coal, ammonium nitrate, chemical reagents (including sulfuric acid), and steel-related products, and components impact the costs of production at our operations and the costs of development projects. These prices fluctuate and can be volatile.
Prices of consumables used in our operations, such as natural gas, diesel, coal, other sources of energy, ammonium nitrate, chemical reagents (including sulfuric acid), and steel-related products, and components impact the costs of production at our operations and the costs of development projects. These prices fluctuate and can be volatile.
Partially because of the Grasberg minerals district’s significance to Indonesia’s economy, the environmentally sensitive area where it is located, and the number of people employed, our Indonesia operations have been the subject of political debates and criticism in the Indonesia press, and have been the target of protests and occasional violence.
Partially because of the Grasberg minerals district’s significance to Indonesia’s economy, the environmentally sensitive area where it is located, and the number of local people employed, our Indonesia operations have been the subject of political debates and criticism in the Indonesia press, 53 Table of Contents and have been the target of protests and occasional violence.
For additional information on climate change conventions, laws, regulations and standards applicable to FCX, refer to Items 1. and 2. “Business and Properties”.
For additional information on climate change conventions, laws, regulations and standards applicable to FCX, refer to Items 1. and 2.
There is ongoing and increasing stakeholder concern relating to a company’s social license to operate and the perceived effects of mining activities on the environment and on communities impacted by such activities.
There is ongoing and increasing stakeholder and other third-party concern relating to a company’s social license to operate and the perceived effects of mining activities on the environment and on communities impacted by such activities.
We are required by U.S. federal and state laws and regulations to provide financial assurance sufficient to allow a third party to implement approved closure and reclamation plans for our mining properties if we are unable to do so. As of December 31, 2022, our financial assurance obligations totaled $1.5 billion for closure and reclamation/restoration costs of U.S. mining sites.
We are required by U.S. federal and state laws and regulations to provide financial assurance sufficient to allow a third party to implement approved closure and reclamation plans for our mining properties if we are unable to do so. As of December 31, 2023, our financial assurance obligations totaled $1.8 billion for closure and reclamation costs of U.S. mining sites.
In early 2017, the Indonesia government issued new regulations to address exports of unrefined metals, including copper concentrate and anode slimes, and other matters related to the mining sector.
In addition, in early 2017, the Indonesia government issued new regulations to address exports of unrefined metals, including copper concentrates and anode slimes, and other matters related to the mining sector.
“Business and Properties” herein) has required changes and could require additional changes to our closure and reclamation plans or modifications to previously completed reclamation actions, although it is uncertain if these changes would result in material capital or operating cost increases.
“Business and Properties” for further discussion) has required changes and could require additional changes to our closure and reclamation plans or modifications to previously completed reclamation actions, although it is uncertain if these changes would result in material capital or operating cost increases.
In 2022, PT-FI produced approximately 67 million metric tons of tailings. Our tailings management plan, which has been approved by the Indonesia government, uses an unnavigable river in the highlands to transport the tailings from the mill to an engineered tailings management area in the lowlands.
In 2023, PT-FI produced approximately 69 million metric tons of tailings. Our tailings management plan, which has been approved by the Indonesia government, uses an unnavigable river in the highlands to transport the tailings from the mill to an engineered tailings management area in the lowlands.
We incur significant costs for remediating environmental conditions on properties that have not been operated in many years. FMC and its subsidiaries, and many of their affiliates and predecessor companies, have been involved in exploration, mining, milling, smelting and manufacturing in the U.S. for more than a century.
“Business and Properties.” We incur significant costs for remediating environmental conditions on or related to properties that have not been operated in many years. FMC and its subsidiaries, and many of their affiliates and predecessor companies, have been involved in exploration, mining, milling, smelting and manufacturing in the U.S. for more than a century.
The mining industry is subject to extensive regulation within Indonesia, and there have been major developments in laws and regulations applicable to mining concession holders, some of which have conflicted with PT-FI’s contractual rights in the past.
The mining industry is subject to extensive regulation within Indonesia, and there have been major developments in laws and regulations applicable to mining concession holders, some of which have conflicted with PT-FI’s contractual rights and may conflict with PT-FI’s contractual rights in the future.
“Business and Properties” and Note 12 for further discussion of our environmental obligations. 66 We face increasing, complex and changing regulatory and stakeholder expectations relating to our climate and energy transition plans, which may adversely affect our business.
“Business and Properties” and Note 12 for further discussion of our environmental obligations. We face increasing, complex and changing regulatory and stakeholder and other third-party expectations relating to our climate and energy transition plans, which may adversely affect our business.
Consumables and components for key machines and equipment we purchase are subject to price volatility caused by global economic factors that are beyond our control, including, but not limited to, supply chain disruptions, labor shortages, wage pressures, rising inflation and potential economic slowdown or recession, as well as fuel and energy costs (for example, the price of diesel), the impact of natural disasters, public health crises (such as COVID-19), geopolitical conflicts (such as the conflict in Ukraine), and foreign currency exchange rate fluctuations, and other matters that have or could impact the global economy.
Consumables and components for key machines and equipment we purchase are subject to price volatility caused by global economic factors that are beyond our control, including, but not limited to, supply chain disruptions, labor shortages, wage pressures, inflation and economic slowdown or recession, as well as fuel and energy costs (for example, the price of diesel), the impact of natural disasters, major public health crises, geopolitical conflicts, and foreign currency exchange rate fluctuations, and other matters that have or could impact the global economy.
The operation and development of our underground mines is also subject to other unique risks including, but not limited to, underground fires or floods, ventilating harmful gases, fall-of-ground accidents, and seismic activity resulting from unexpected or difficult geological formations or conditions. For example, we experience mining induced seismic activity from time to time in the Grasberg minerals district.
The development of our underground mines is also subject to other unique risks including, but not limited to, underground fires or floods, ventilating harmful gases, fall-of-ground accidents, and seismic activity resulting from unexpected or difficult geological formations or conditions, which we experience from time to time in the Grasberg minerals district.
Based on our own studies and others conducted by third parties, we believe that our controlled riverine transport system is the best site-specific option for tailings management at the Indonesia site.
Based on our own studies and others conducted by third parties, we believe that our controlled riverine transport system is the best site-specific option for tailings management at the Grasberg minerals district.
International risks • Geopolitical, economic and social risks for our international operations; and • Failure of PT-FI to meet its commitments to achieve the extension of PT-FI’s IUPK through 2041. 48 Operational risks • Operational risks inherent in mining, including underground mining; • Environmental, safety and engineering challenges and risks associated with management of waste rock and tailings; • Environmental challenges associated with our Indonesia mining operations; • Violence, civil and religious strife, and activism; • Availability of significant quantities of secure water supplies for our mining operations, including future expansions or development projects; • Any major public health crisis; and • Disruptions, damage, failure and implementation and integration risks associated with information technology systems.
International risks • Geopolitical, economic, regulatory and social risks for our international operations; and • Failure of PT-FI to meet its commitments to achieve the extension of PT-FI’s IUPK through 2041. 47 Table of Contents Operational risks • Operational risks inherent in mining, including underground mining and the ability to smelt and refine; • Environmental, safety and engineering challenges and risks associated with management of waste rock and tailings; • Environmental challenges associated with our Indonesia mining operations; • Violence, civil and religious strife, and activism; • Availability of significant quantities of secure water supplies for our mining operations, including future expansions or development projects; • Disruptions, damage, failure and implementation and integration risks associated with information and operational technology systems and new technologies; and • Any major public health crisis.
In response to climate change and societal and stakeholder demands for action, we have announced 2030 GHG emissions reduction targets and a 2050 net zero aspiration, which will result in additional costs to us, the totality of which we cannot currently estimate with accuracy, and we cannot guarantee that we will be able to achieve any current or future GHG emissions targets or aspirations.
“Business and Properties.” 66 Table of Contents In response to climate change and societal or stakeholder demands for action, we have announced 2030 GHG emissions reduction targets and a 2050 net zero aspiration, each of which will result in additional costs to us, the totality of which we cannot currently estimate with accuracy, and we cannot guarantee that we will be able to achieve any current or future GHG emissions targets or aspirations.
Copper prices also may be affected by the growing markets for automobiles and appliances, and the global focus on a transition to new technologies for clean energy, to advance communications and to enhance public health, inadequate investment in and limited production from copper mining operations in South America, as well as demand from North America, Europe, and Asian countries other than China.
Copper prices also may be affected by the construction industry, the markets for automobiles and appliances, the global focus on a transition to new technologies for clean energy, advancement in communications and enhanced public health, and inadequate investment in and limited production from copper mining operations in South America, as well as demand from North America, Europe, and Asian countries other than China.
Fluctuations in commodities prices are caused by varied and complex factors beyond our control, including global supply and demand and inventory levels; global economic and political conditions (such as a potential global recession and Russia’s invasion of Ukraine); international regulatory, trade and/or tax policies, including national tariffs; commodities investment activity and speculation; interest rates; expectations regarding future inflation rates; the strength of the U.S. dollar compared to foreign currencies; the price and availability of substitute products; and changes in technology.
Fluctuations in commodities prices are caused by varied and complex factors beyond our control, including global supply and demand and inventory levels; global economic and political conditions (such as level of economic growth or recession and political or geopolitical conflicts); international regulatory, trade and/or tax policies, including national tariffs; commodities investment activity and speculation; interest rates; expectations regarding future inflation rates; the strength of the U.S. dollar compared to foreign currencies; the price and availability of substitute products; and changes in technology.

… 220 more changes not shown on this page.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

18 edited+4 added−1 removed29 unchanged
Biggest changeThe U.S. declined to pursue an interlocutory appeal in either of the In re Aravaipa Canyon Wilderness Area or In re Redfield Canyon Wilderness Area cases, and we believe the rulings in those cases will support our positions in other pending federal reserved water right cases, including: In re Fort Huachuca , which involves the U.S.’s claims to water for an Arizona army base and is awaiting a decision following a trial which concluded in February 2017; and In re San Pedro Riparian National Conservation Area , which involves the U.S.’s claims to water for a national conservation area and is awaiting a decision following a trial which concluded in May 2018.
Biggest changeA fourth case, In re Fort Huachuca , which involves the U.S.’s claims to water for an Arizona army base, is awaiting a decision following a trial that concluded in February 2017.
The second resolved decision was issued in In re Redfield Canyon Wilderness Area , which was another case to resolve claims for a wilderness area. The court issued its decision in August 2022 supportive of our position on almost all issues, denying the U.S.’s federal reserved water rights claims for the wilderness area.
The second resolved decision was issued in In re Redfield Canyon Wilderness Area , which was another case pertaining to claims for a wilderness area. The court issued its decision in August 2022 supportive of our position on almost all issues, denying the U.S.’s federal reserved water rights claims for the wilderness area.
Groundwater is treated differently from surface water under Arizona law, which historically allowed land owners to pump unlimited quantities of subsurface water, subject only to the requirement of putting it to “reasonable use.” However, court decisions in the adjudication have concluded that some subsurface water constitutes “subflow” that is to be treated legally as surface water and is therefore subject to the Arizona doctrine of prior appropriation and to the adjudication, and potentially unavailable to groundwater pumpers, including us, in the absence of valid surface water claims.
Groundwater is treated differently from surface water under Arizona law, which historically allowed landowners to pump unlimited quantities of subsurface water, subject only to the requirement of putting it to “reasonable use.” However, court decisions in the adjudication have concluded that some subsurface water constitutes “subflow” that is to be treated legally as surface water and is therefore subject to the Arizona doctrine of prior appropriation and to the adjudication, and potentially unavailable to groundwater pumpers, including us, in the absence of valid surface water claims.
Such matters will be determined by a subsequent “subflow depletion test,” which is expected to be proposed by ADWR in 2023. While some of our adversaries objected to the Special Master’s final decision, in July 2022, the Arizona Superior Court issued a decision affirming the Special Master’s decision in all respects. No party has appealed that decision.
Such matters will be determined by a subsequent “subflow depletion test,” which was proposed by ADWR in 2023. While some of our adversaries objected to the Special Master’s final decision, in July 2022, the Arizona Superior Court issued a decision affirming the Special Master’s decision in all respects. No party has appealed that decision.
In Arizona, where our operations use both surface and groundwater, we are a participant in an active adjudication in which Arizona courts have been attempting, for over 45 years, to quantify and prioritize surface water claims for the Gila River system, one of the state’s largest river systems.
In Arizona, where our operations use both surface and groundwater, we are a participant in an active adjudication in which Arizona courts have been attempting, for 50 years, to quantify and prioritize surface water claims for the Gila River system, one of the state’s largest river systems.
We, along with allied parties, have objected to the Special Master’s ruling and are awaiting further proceedings before the Arizona Superior Court. Regardless of the outcome in the Arizona Superior Court, we anticipate this issue will be appealed to the Arizona Supreme Court.
We, along with allied parties, have objected to the Special Master’s ruling and are awaiting further proceedings before the Arizona Superior Court. 73 Table of Contents Regardless of the outcome in the Arizona Superior Court, we anticipate this issue will be appealed to the Arizona Supreme Court.
No party has appealed that decision, and we expect the guidance from the Special Master’s order to be reflected in ADWR’s subflow depletion test report (due December 2023).
No party has appealed that decision, and we expect the guidance from the Special Master’s order to be reflected in ADWR’s subflow depletion test report.
These federal proceedings have been stayed in favor of the adjudications pending in Arizona state courts, and some of the federal suits have since been settled.
These federal proceedings have been 72 Table of Contents stayed in favor of the adjudications pending in Arizona state courts, and some of the federal suits have since been settled.
In December 2018, ADWR submitted its initial report on the “subflow depletion test,” noting that the test will specify the methodology a well owner must use to quantify the portion of the water drawn from a well that is subflow as opposed to groundwater.
In December 2018, ADWR submitted its initial report on the “subflow depletion test,” noting that the test will specify the methodology a well owner must use to quantify the portion of the water drawn from a well that is subflow as opposed to groundwater. ADWR’s report setting forth its proposed subflow depletion test is due later in February 2024.
If we are not able to satisfactorily resolve the issues being addressed in the adjudications, our ability to pump groundwater could be diminished or curtailed, and our operations and any future expansions at Morenci, Safford (including Lone Star) and Sierrita could be adversely affected unless we are able to acquire alternative water resources.
If we are not able to satisfactorily resolve the issues being addressed in the adjudications, our water uses could be diminished or curtailed, and our operations and any future expansions at Morenci, Safford (including Lone Star) and Sierrita could be adversely affected unless we are able to acquire alternative water sources. 74 Table of Contents
Management does not believe, based on currently available information, that the outcome of any currently pending legal proceeding will have a material adverse effect on our financial condition; although individual or cumulative outcomes could be material to our operating results for a particular period, depending on the nature and magnitude of the outcome and the operating results for the period. 70 Water Rights Adjudications Our operations in the western U.S. require significant secure quantities of water for mining and ore processing activities, and related support facilities.
Management does not believe, based on currently available information, that the outcome of any currently pending legal proceeding will have a material adverse effect on our financial condition; although individual or cumulative outcomes could be material to our operating results for a particular period, depending on the nature and magnitude of the outcome and the operating results for the period.
While we do not have any active mining operations in the Verde River watershed that would be impacted by this phase of the adjudication, we filed a set of limited objections on issues that could set a precedent for other watersheds in Arizona that could have material implications for many users of groundwater, including our Arizona operations, and our objections have not been resolved. 71 In 2014, ADWR submitted a proposal for the development of procedures for “cone of depression” analyses to determine whether a well located outside of the subflow zone creates a cone of depression that intersects the subflow zone.
While we do not have any active mining operations in the Verde River watershed that would be impacted by this phase of the adjudication, we filed a set of limited objections on issues that could set a precedent for other watersheds in Arizona that could have material implications for many users of groundwater, including our Arizona operations, and our objections have not been resolved.
We, along with the other parties, will have the opportunity to provide inputs throughout the process. An issue litigated in the 2018 proceeding concerned whether for the subflow depletion test the subflow zone should be represented in the numeric model as extending only as deep as the bottom of the floodplain alluvium or extend all the way down to bedrock.
Objections to such report are due in April 2024. An issue litigated in the 2018 proceeding concerned whether for the subflow depletion test the subflow zone should be represented in the numeric model as extending only as deep as the bottom of the floodplain alluvium or extend all the way down to bedrock.
Continuous operation of our mines is dependent on, among other things, our ability to maintain our water rights and claims and the continuing physical availability of the water supplies.
Water Rights Adjudications Our operations in the western U.S. require significant secure quantities of water for mining and ore processing activities, and related support facilities. Continuous operation of our mines is dependent on, among other things, our ability to maintain our water rights and claims and the continuing physical availability of the water supplies.
Because federal reserved water rights may adversely affect water uses at each of these operations, we have been actively involved in litigation over these claims.
Because federal reserved water rights may adversely affect water uses at each of these operations, we have been actively involved in litigation over these claims. Because federal reserved water rights have not yet been quantified, the task of determining how much water each federal reservation may use has been left to the Arizona Superior Court handling the Gila River adjudication.
The first resolved decision was issued in In re Aravaipa Canyon Wilderness Area, which was to resolve the U.S.’s claims to water for the Aravaipa Canyon Wilderness Area.
The U.S. declined to pursue an interlocutory appeal in either of the In re Aravaipa Canyon Wilderness Area or In re Redfield Canyon Wilderness Area cases. The third resolved decision was issued in In re San Pedro Riparian National Conservation Area , which pertained to the U.S.’s claims to water for a national conservation area.
In January 2023, the U.S. filed several federal reserved water rights claims for federal reservations in portions of the Verde River watershed, and we anticipate that the Special Master will establish litigation schedules to resolve the claims for those reservations.
In addition, in January 2023, the U.S. filed several federal reserved water rights claims for wilderness areas in portions of the Verde River watershed, as well as a claim for the Verde River pursuant to the Wild and Scenic Rivers Act, claiming all unappropriated flow within each of the wilderness areas, along with alternative claims to specific stream flows.
Because federal reserved water rights have not yet been quantified, the task of 72 determining how much water each federal reservation may use has been left to the Arizona Superior Court handling the Gila River adjudication. Several “contested cases” to quantify reserved water rights for particular federal reservations in Arizona are currently pending with only two resolved at this time.
Various “contested cases” to quantify reserved water rights for particular federal reservations in Arizona are currently pending, three of which have been resolved at this time. The first resolved decision was issued in In re Aravaipa Canyon Wilderness Area, which pertained to the U.S.’s claims to water for the Aravaipa Canyon Wilderness Area.
Removed
The Special Master has ordered ADWR to schedule meetings in 2023 to discuss progress on developments of the test, with a deadline of December 2023 for ADWR’s report setting forth its proposed depletion test. Objections to such report are expected to be due in February 2024.
Added
In 2014, ADWR submitted a proposal for the development of procedures for “cone of depression” analyses to determine whether a well located outside of the subflow zone creates a cone of depression that intersects the subflow zone.
Added
The court issued its decision in August 2023 supportive of our position on nearly all issues, rejecting the U.S.’s argument that quantification was based on a more lenient standard than the “minimal need” doctrine, and holding that the U.S. may not obtain a federal reserved right to “optimal” flows to support the riparian and aquatic resources.
Added
The court adopted our proposed period of record for quantifying the stream, and therefore adopted our proposed streamflow, and rejected the U.S.’s claims for “streamflow augmentation” and claims to water from various point sources. It is unknown whether the U.S. will pursue an interlocutory appeal.
Added
In reliance on the favorable precedent created in the cases discussed above, we successfully defeated the claims to all unappropriated flow on summary judgment. We anticipate that the Special Master will establish litigation schedules concerning the other claims to specific stream flows.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

11 edited+2 added−1 removed0 unchanged
Biggest changeQuirk has served as President since February 2021 and as a director of the Board since February 2023. Ms. Quirk previously served as CFO from December 2003 to March 2022, Executive Vice President from March 2007 to February 2021, Treasurer from February 2000 to August 2018 and as Senior Vice President from December 2003 to March 2007. Ms.
Biggest changeQuirk previously served as CFO from December 2003 to March 2022, Executive Vice President from March 2007 to February 2021, Senior Vice President from December 2003 to March 2007 and Treasurer from February 2000 to August 2018. Ms. Quirk also serves on the Board of Directors of Vulcan Materials Company. Maree E.
Item 4. Mine Safety Disclosures. Our highest priority is the health, safety and well-being of our workforce. We believe that health and safety considerations are integral to, and fundamental for, all other functions in our organization, and we understand that the health and safety of our workforce is critical to our operational efficiency and long-term success.
Item 4. Mine Safety Disclosures. Our highest priority is the health, safety and well-being of our workforce. We believe health and safety considerations are integral to, and fundamental for, all other functions in our organization, and we understand that the health and safety of our workforce is critical to our operational efficiency and long-term success.
Higgins has served as Chief Administrative Officer since January 2019 and as Senior Vice President since August 2018. Mr. Higgins previously served as Vice President - Sales and Marketing from March 2007 to August 2018 and as President of Freeport-McMoRan Sales Company, Inc. from April 2006 to August 2019. Douglas N.
Higgins has served as Chief Administrative Officer since January 2019 and as Senior Vice President since August 2018. Mr. Higgins previously served as Vice President – Sales and Marketing from March 2007 to August 2018 and President of Freeport-McMoRan Sales Company Inc. from April 2006 to August 2019. Douglas N.
Adkerson previously served as Vice Chairman of 73 the Board from May 2013 to February 2021, President from January 2008 to February 2021 and also from April 1997 to March 2007, and Chief Financial Officer (CFO) from October 2000 to December 2003. Kathleen L.
Adkerson previously served as Vice Chairman of the Board from May 2013 to February 2021, President from January 2008 to February 2021 and also from April 1997 to March 2007, and Chief Financial Officer (CFO) from October 2000 to December 2003. Kathleen L.
Currault II has served as Senior Vice President and General Counsel since October 2019. Mr. Currault previously served as Deputy General Counsel from January 2015 to October 2019, Assistant General Counsel from January 2008 to January 2015, Secretary from May 2007 to December 2019 and as Assistant Secretary from February 2000 to May 2007. PART II
Currault II has served as Senior Vice President and General Counsel since October 2019. Mr. Currault previously served as Deputy General Counsel from January 2015 to October 2019, Assistant General Counsel from January 2008 to January 2015, Secretary from May 2007 to December 2019 and Assistant Secretary from February 2000 to May 2007. 75 Table of Contents PART II
Prior to joining Rio Tinto, Ms. Robertson had a 17-year career at BHP Group, a multinational natural resources company, serving in a broad range of international finance functions, including Vice President, Finance, Petroleum USA; Head of Finance, Conventional and Potash, Petroleum, USA; Vice President, Finance, Potash Canada; and Vice President, Finance, Minera Escondida Ltda. Stephen T.
Robertson had a 17-year career at BHP Group, a multinational natural resources company, serving in a broad range of international finance functions, including Vice President, Finance, Petroleum USA; Head of Finance, Conventional and Potash, Petroleum, USA; Vice President, Finance, Potash Canada; and Vice President, Finance, Minera Escondida Ltda. Stephen T.
Information About our Executive Officers. Certain information as of February 15, 2023, about our executive officers is set forth in the following table and accompanying text: Name Age Position or Office Richard C. Adkerson 76 Chairman of the Board and Chief Executive Officer Kathleen L. Quirk 59 President and Director of the Board Maree E.
Information About Our Executive Officers. Certain information as of February 15, 2024, about our executive officers is set forth in the following table and accompanying text: Name Age Position or Office Richard C. Adkerson 77 Chairman of the Board and Chief Executive Officer Kathleen L. Quirk 60 President Maree E.
Robertson 47 Senior Vice President and Chief Financial Officer Stephen T. Higgins 65 Senior Vice President and Chief Administrative Officer Douglas N. Currault II 58 Senior Vice President and General Counsel Richard C. Adkerson has served as Chairman of the Board since February 2021, Chief Executive Officer since December 2003 and has been a director since October 2006. Mr.
Robertson 48 Senior Vice President and Chief Financial Officer Stephen T. Higgins 66 Senior Vice President and Chief Administrative Officer Douglas N. Currault II 59 Senior Vice President and General Counsel Richard C. Adkerson has served as Chairman of the Board since February 2021, Chief Executive Officer (CEO) since December 2003 and has been a director since October 2006.
Quirk also serves on the Board of Directors of Vulcan Materials Company. Maree E. Robertson has served as Senior Vice President and CFO since March 2022. Prior to joining the company, Ms. Robertson served as CFO, Energy and Minerals of Rio Tinto Group, a multinational metals and mining company, from September 2019 to December 2021.
Robertson has served as Senior Vice President and CFO since March 2022. Prior to joining the company, Ms. Robertson served as CFO, Energy and Minerals of Rio Tinto Group, a multinational metals and mining company, from September 2019 to December 2021. Prior to joining Rio Tinto, Ms.
Mine Safety and Health Administration was 1.83 for 2022 (preliminary for the period of January 1, 2022, through September 30, 2022) and 1.71 in 2021. Refer to Exhibit 95.1 for mine safety disclosures required in accordance with Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of SEC Regulation S-K.
The goal of our FRM program is to achieve zero workplace fatalities by raising awareness to fatal risks and the measures necessary to mitigate them. Refer to Exhibit 95.1 for mine safety disclosures required in accordance with Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of SEC Regulation S-K.
Our global health and safety approach, “Safe Production Matters,” is focused on fatality prevention and continuous improvement through the use of robust management systems, empowering safe work behaviors and strengthening our safety culture. Our objective is to achieve zero workplace fatalities and to decrease injuries and occupational illnesses.
Our global health and safety strategy, “Safe Production Matters,” is focused on fatality prevention, eliminating systemic root causes of incidents and continuous improvement through robust management systems, which are supported by leaders empowering our teams to work safely. Foundational to our Safe Production Matters strategy is our Fatal Risk Management (FRM) program.
Removed
We measure progress toward achieving our objective against regularly established benchmarks, including measuring company-wide Total Recordable Incident Rates (TRIR). Our TRIR (including contractors) per 200,000 man-hours worked was 0.77 in 2022 and 0.70 in 2021. The metal mining sector industry average per 200,000 man-hours worked reported by the U.S.
Added
Effective at the annual meeting of stockholders on June 11, 2024, Mr. Adkerson will transition his duties as CEO to Ms. Quirk. Mr. Adkerson will remain Chairman of the Board, supporting the leadership transition and our business on strategic matters of significance to the company. Mr.
Added
Quirk has served as President since February 2021 and as a director of the Board since February 2023. Effective at the annual meeting of stockholders on June 11, 2024, Ms. Quirk will become President and CEO and will assume full responsibility for executive management of our business, reporting to our Board. Ms.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+3 added−1 removed3 unchanged
Biggest change“Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk” and Note 10 for further discussion. 74 Table of Contents Issuer Purchases of Equity Securities The following table summarizes share repurchases made by us during the three months ended December 31, 2022, and the approximate dollar value of shares that may yet be purchased pursuant to our share repurchase program: Period (a) Total Number of Shares Purchased (b) Average Price Paid Per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs a (d) Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs a October 1-31, 2022 — $ — — $ 3,164,642,228 November 1-30, 2022 — $ — — $ 3,164,642,228 December 1-31, 2022 — $ — — $ 3,164,642,228 Total — $ — — a.
Biggest changeIssuer Purchases of Equity Securities The following table sets forth information with respect to shares of FCX common stock purchased by us during the three months ended December 31, 2023, and the approximate dollar value of shares that may yet be purchased pursuant to our share repurchase program: Period (a) Total Number of Shares Purchased (b) Average Price Paid Per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs a (d) Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs a October 1-31, 2023 — $ — — $ 3,164,642,228 November 1-30, 2023 — $ — — $ 3,164,642,228 December 1-31, 2023 — $ — — $ 3,164,642,228 Total — $ — — a.
The combined annual rate of the base dividend and the variable dividend totaled $0.60 per share for 2022.
The combined annual rate of the base dividend and the variable dividend totaled $0.60 per share for 2023 and 2022.
Based on current market conditions, the base and variable dividends on our common stock are anticipated to total $0.60 per share for 2023 (including the dividends paid on February 1, 2023), comprised of a $0.30 per share base dividend and $0.30 per share variable dividend.
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), comprised of a $0.30 per share base dividend and $0.30 per share variable dividend.
In December 2022, 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 variable, performance-based cash dividend), which was paid on February 1, 2023, to shareholders of record as of January 13, 2023.
In December 2023, 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 variable, performance-based cash dividend), which was paid on February 1, 2024, to shareholders of record as of January 12, 2024.
The share repurchase program does not obligate us to acquire any specific amount of shares and does not have an expiration date. The timing and amount of the share repurchases is at the discretion of management and will depend on a variety of factors. The program may be modified, increased, suspended or terminated at any time at the Board’s discretion.
The share repurchase program does not obligate us to acquire any specific amount of shares and does not have an expiration date. The timing and amount of the share repurchases is at the discretion of management and will depend on a variety of factors.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Unregistered Sales of Equity Securities None. Common Stock Our common stock is traded on the New York Stock Exchange under the symbol “FCX.” At January 31, 2023, there were 10,187 holders of record of our common stock.
Common Stock Our common stock is traded on the New York Stock Exchange under the symbol “FCX.” At January 31, 2024, there were 9,671 holders of record of our common stock.
Removed
See Note 10 and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, for further discussion.
Added
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Unregistered Sales of Equity Securities There were no unregistered sales of equity securities during the three months ended December 31, 2023.
Added
“Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk” and Note 10 for further discussion.
Added
The share repurchase program may be modified, increased, suspended or terminated at any time at our Board’s discretion. See Item 1A. “Risk Factors” and Note 10 for further discussion.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

253 edited+81 added−97 removed58 unchanged
Biggest changeImportant 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; price and availability of consumables and components we purchase as well as constraints on supply and logistics, and transportation services; changes in our cash requirements, financial position, financing or investment plans; changes in general market, economic, regulatory or industry conditions, including as a result of Russia’s invasion of Ukraine or potential global economic downturn or recession; reductions in liquidity and access to capital; changes in tax laws and regulations, including the impact of the Act; any major public health crisis; political and social risks, including the potential effects of violence in Indonesia, civil unrest in Peru, and relations with local communities and Indigenous Peoples; operational risks inherent in mining, with higher inherent risks in underground mining; mine sequencing; changes in mine plans or operational modifications, delays, deferrals or cancellations; production rates; timing of shipments; results of technical, economic or feasibility studies; potential inventory adjustments; potential impairment of long-lived mining assets; the Indonesia government’s extension of PT-FI’s copper concentrate export license after March 19, 2023; PT-FI’s ability to export and sell copper concentrate and anode slimes; satisfaction of requirements in accordance with PT-FI’s IUPK to extend mining rights from 2031 through 2041; the Indonesia government’s approval of a deferred schedule for completion of additional domestic smelting capacity in Indonesia; discussions relating to the extension of PT-FI’s IUPK beyond 2041; cybersecurity incidents; labor relations, including labor-related work stoppages and costs; the results of the PT-FI human health assessment to evaluate the potential impacts of tailings and mining waste, and compliance with applicable environmental, health and safety laws and regulations; weather- and climate-related risks; environmental risks, including availability of secure water supplies, and litigation results; 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 in Item 1A.
Biggest changeImportant 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; changes in export duties, including results of proceedings to dispute export duties; completion of additional domestic smelting and refining capacity in Indonesia; production rates; timing of shipments; price and availability of consumables and components we purchase as well as constraints on supply and logistics, and transportation services; changes in our cash requirements, financial position, financing or investment plans; changes in general market, economic, geopolitical, regulatory or industry conditions; reductions in liquidity and access to capital; changes in tax laws and regulations; political and social risks, including the potential effects of violence in Indonesia, civil unrest in Peru, and relations with local communities and Indigenous Peoples; operational risks inherent in mining, with higher inherent risks in underground mining; mine sequencing; changes in mine plans or operational modifications, delays, deferrals or cancellations, including the ability to smelt and refine; results of technical, economic or feasibility studies; potential inventory adjustments; potential impairment of long-lived mining assets; satisfaction of requirements in accordance with PT-FI’s IUPK to extend mining rights from 2031 through 2041; discussions relating to the extension of PT-FI’s IUPK beyond 2041; cybersecurity risks; any major public health crisis; labor relations, including labor-related work stoppages and increased costs; compliance with applicable environmental, health and safety laws and regulations; weather- and climate-related risks; environmental risks, including availability of secure water supplies; litigation results; 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 in Item 1A.
The areas requiring the use of management’s estimates are also discussed in Note 1 under the subheading “Use of Estimates.” Management has reviewed the following discussion of its development and selection of critical accounting estimates with the Audit Committee of our Board of Directors (the Board). Taxes Refer to Note 11 and Item 1A.
The areas requiring the use of management’s estimates are also discussed in Note 1 under the subheading “Use of Estimates.” Management has reviewed the following discussion of its development and selection of critical accounting estimates with the Audit Committee of our Board of Directors (Board). Taxes Refer to Note 11, and Item 1A.
We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP.
We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP.
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.
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 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.
We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP.
We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP.
We closely monitor market conditions and will adjust our operating plans to protect liquidity and preserve our asset values, if necessary. We expect to maintain a solid balance sheet and strong 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.
We closely monitor market conditions and will adjust our operating plans to protect liquidity and preserve our asset values, if necessary. 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.
Substantially all of our copper concentrate and cathode sales contracts provide final copper pricing in a specified future month (generally one to four months from the shipment date) based primarily on quoted LME monthly average copper settlement prices.
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) based primarily on quoted LME monthly average copper settlement prices.
GAAP. Refer to “Operations - Unit Net Cash Costs” for further discussion of unit net cash costs 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.
Refer to “Operations – Unit Net Cash Costs” for further discussion of unit net cash costs 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.
In addition to the geology of our mines, assumptions are required to determine the economic feasibility of mining these reserves, including estimates of future commodity prices and demand, the mining methods we use and the related costs incurred to develop and mine our mineral reserves.
In addition to the geology of our mines, assumptions are required to determine the economic feasibility of mining these reserves, including estimates of future commodity prices, the mining methods we use and the related costs incurred to develop and mine our mineral reserves.
Capital expenditures, including capitalized interest, totaled $3.5 billion for the year 2022, including $1.7 billion for major mining projects primarily associated with the underground development activities in the Grasberg minerals district and $0.8 billion for the Indonesia smelter projects.
Capital expenditures, including capitalized interest, totaled $3.5 billion for the year 2022, including $1.7 billion for major projects primarily associated with underground development activities in the Grasberg minerals district and $0.8 billion for the Indonesia smelter projects.
Represents the combined total for our other mining operations as presented in Note 16. 110 Table of Contents Indonesia Mining Product Revenues, Production Costs and Unit Net Cash Costs Year Ended December 31, 2022 (In millions) By-Product Co-Product Method Method Copper Gold Silver a Total Revenues, excluding adjustments $ 6,018 $ 6,018 $ 3,237 $ 134 $ 9,389 Site production and delivery, before net noncash and other costs shown below 2,507 1,607 864 36 2,507 Gold and silver credits (3,375) — — — — Treatment charges 341 218 118 5 341 Export duties 307 197 106 4 307 Royalty on metals 357 230 124 3 357 Net cash costs 137 2,252 1,212 48 3,512 DD&A 1,025 657 353 15 1,025 Noncash and other costs, net 182 b 117 63 2 182 Total costs 1,344 3,026 1,628 65 4,719 Other revenue adjustments, primarily for pricing on prior period open sales 27 27 3 1 31 PT Smelting intercompany profit 14 9 5 — 14 Gross profit $ 4,715 $ 3,028 $ 1,617 $ 70 $ 4,715 Copper sales (millions of recoverable pounds) 1,582 1,582 Gold sales (thousands of recoverable ounces) 1,811 Gross profit per pound of copper/per ounce of gold: Revenues, excluding adjustments $ 3.80 $ 3.80 $ 1,787 Site production and delivery, before net noncash and other costs shown below 1.58 1.01 477 Gold and silver credits (2.13) — — Treatment charges 0.22 0.14 65 Export duties 0.19 0.12 58 Royalty on metals 0.23 0.15 69 Unit net cash costs 0.09 1.42 669 DD&A 0.65 0.42 195 Noncash and other costs, net 0.11 b 0.07 35 Total unit costs 0.85 1.91 899 Other revenue adjustments, primarily for pricing on prior period open sales 0.02 0.01 2 PT Smelting intercompany profit 0.01 0.01 3 Gross profit per pound/ounce $ 2.98 $ 1.91 $ 893 Reconciliation to Amounts Reported Production Revenues and Delivery DD&A Totals presented above $ 9,389 $ 2,507 $ 1,025 Treatment charges (341) — — Export duties (307) — — Royalty on metals (357) — — Noncash and other costs, net 11 193 — Other revenue adjustments, primarily for pricing on prior period open sales 31 — — PT Smelting intercompany profit — (14) — Eliminations and other — (2) — Indonesia mining 8,426 2,684 1,025 Other mining c 20,748 16,563 924 Corporate, other & eliminations (6,394) (6,206) 70 As reported in our consolidated financial statements $ 22,780 $ 13,041 $ 2,019 a.
Represents the combined total for our other mining operations as presented in Note 16. 111 Table of Contents Indonesia Mining Product Revenues, Production Costs and Unit Net Cash Costs Year Ended December 31, 2022 (In millions) Co-Product Method By-Product Method Copper Gold Silver & Other a Total Revenues, excluding adjustments $ 6,018 $ 6,018 $ 3,237 $ 134 $ 9,389 Site production and delivery, before net noncash and other costs shown below 2,507 1,607 864 36 2,507 Gold, silver and other by-product credits (3,375) — — — — Treatment charges 341 218 118 5 341 Export duties 307 197 106 4 307 Royalty on metals 357 230 124 3 357 Net cash costs 137 2,252 1,212 48 3,512 DD&A 1,025 657 353 15 1,025 Noncash and other costs, net 182 b 117 63 2 182 Total costs 1,344 3,026 1,628 65 4,719 Other revenue adjustments, primarily for pricing on prior period open sales 27 27 3 1 31 PT Smelting intercompany profit 14 9 5 — 14 Gross profit $ 4,715 $ 3,028 $ 1,617 $ 70 $ 4,715 Copper sales (millions of recoverable pounds) 1,582 1,582 Gold sales (thousands of recoverable ounces) 1,811 Gross profit per pound of copper/per ounce of gold: Revenues, excluding adjustments $ 3.80 $ 3.80 $ 1,787 Site production and delivery, before net noncash and other costs shown below 1.58 1.01 477 Gold, silver and other by-product credits (2.13) — — Treatment charges 0.22 0.14 65 Export duties 0.19 0.12 58 Royalty on metals 0.23 0.15 69 Unit net cash costs 0.09 1.42 669 DD&A 0.65 0.42 195 Noncash and other costs, net 0.11 b 0.07 35 Total unit costs 0.85 1.91 899 Other revenue adjustments, primarily for pricing on prior period open sales 0.02 0.01 2 PT Smelting intercompany profit 0.01 0.01 3 Gross profit per pound/ounce $ 2.98 $ 1.91 $ 893 Reconciliation to Amounts Reported Production Revenues and Delivery DD&A Totals presented above $ 9,389 $ 2,507 $ 1,025 Treatment charges (341) — — Export duties (307) — — Royalty on metals (357) — — Noncash and other costs, net 11 193 — Other revenue adjustments, primarily for pricing on prior period open sales 31 — — PT Smelting intercompany profit — (14) — Eliminations and other — (2) — Indonesia mining 8,426 2,684 1,025 Other mining c 20,748 16,592 924 Corporate, other & eliminations (6,394) (6,206) 70 As reported in our consolidated financial statements $ 22,780 $ 13,070 $ 2,019 a.
Includes silver sales of 6.3 million ounces ($21.41 per ounce average realized price). b. Includes charges totaling $116 million ($0.07 per pound of copper) associated with an ARO adjustment.
Includes silver sales of 6.3 million ounces ($21.41 per ounce average realized price). b. Includes charges of $116 million ($0.07 per pound of copper) associated with an ARO adjustment.
We have uncertain tax positions related to income tax assessments in Indonesia and Peru, including penalties and interest, which have not been recorded at December 31, 2022. Final taxes paid may be dependent upon many factors, including negotiations with taxing authorities. In certain jurisdictions, we pay a portion of the disputed amount before formally appealing an assessment.
We have uncertain tax positions related to income tax assessments in Peru and Indonesia, including penalties and interest, which have not been recorded at December 31, 2023. Final taxes paid may be dependent upon many factors, including negotiations with taxing authorities. In certain jurisdictions, we pay a portion of the disputed amount before formally appealing an assessment.
Our copper mining operations require significant amounts of energy, principally diesel, electricity, coal and natural gas, most of which is obtained from third parties under long-term contracts. Our take-or-pay contractual obligations for electricity totaled approximately $0.3 billion at December 31, 2022. We do not have take-or-pay contractual obligations for other energy commodities.
Our copper mining operations require significant amounts of energy, principally diesel, electricity, coal and natural gas, most of which is obtained from third parties under long-term contracts. Our take-or-pay contractual obligations for electricity totaled approximately $0.3 billion at December 31, 2023. We do not have take-or-pay contractual obligations for other energy commodities.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk” contained in Part II of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. OVERVIEW We are a leading international mining company with headquarters in Phoenix, Arizona.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk” contained in Part II of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. OVERVIEW We are a leading international mining company with headquarters in Phoenix, Arizona.
Accounting for environmental obligations represents a critical accounting estimate because (i) changes to environmental laws and regulations and/or circumstances affecting our operations could result in significant changes to our estimates, which could have a significant impact on our results of operations, (ii) we will not incur most of these costs for a number of years, requiring us to make estimates over a long period, (iii) calculating the discounted cash flows for certain of our environmental obligations requires management to estimate the amounts and timing of projected cash flows and make long-term assumptions about inflation rates and (iv) changes in 82 Table of Contents estimates used in determining our environmental obligations could have a significant impact on our results of operations.
Accounting for environmental obligations represents a critical accounting estimate because (i) changes to environmental laws and regulations and/or circumstances affecting our operations could result in significant changes to our estimates, which could have a significant impact on our results of operations, (ii) we will not incur most of these costs for a number of years, requiring us to make estimates over a long period, (iii) calculating the discounted cash flows for certain of our environmental obligations requires management to estimate the amounts and timing of projected cash flows and make long-term assumptions about inflation rates and (iv) changes in estimates used in determining our environmental obligations could have a significant impact on our results of operations.
Mineral Reserves Refer to Note 17, Items 1. and 2. “Business and Properties” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, for further information regarding, and risks associated with, our estimated recoverable proven and probable mineral reserves.
Mineral Reserves Refer to Note 17, and Items 1. and 2. “Business and Properties” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, for further information regarding, and risks associated with, our estimated recoverable proven and probable mineral reserves.
DISCLOSURES ABOUT MARKET RISKS Commodity Price Risk Our 2022 consolidated revenues from our mining operations include the sale of copper concentrate, copper cathode, copper rod, gold, molybdenum and other metals by our North America and South America mines, the sale of copper concentrate (which also contains significant quantities of gold and silver) by our Indonesia mining operations, the sale of molybdenum in various forms by our molybdenum operations, and the sale of copper cathode, copper anode and gold in anode and slimes by Atlantic Copper.
DISCLOSURES ABOUT MARKET RISKS Commodity Price Risk Our 2023 consolidated revenues from our mining operations include the sale of copper concentrate, copper cathode, copper rod, gold, molybdenum and other metals by our North America and South America mines, the sale of copper concentrate (which also contains significant quantities of gold and silver), copper cathode and anode slimes by our Indonesia mining operations, the sale of molybdenum in various forms by our molybdenum operations, and the sale of copper cathode, copper anode and gold in anode and slimes by Atlantic Copper.
Asset Retirement Obligations Refer to Notes 1 and 12, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, for further discussion of reclamation and closure costs, including a summary of changes in our asset retirement obligations (AROs) for the three years ended December 31, 2022.
Asset Retirement Obligations Refer to Notes 1 and 12, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, for further discussion of reclamation and closure costs, including a summary of changes in our asset retirement obligations (AROs) for the three years ended December 31, 2023.
The words “anticipates,” “may,” “can,” “plans,” “believes,” “estimates,” “expects,” “projects,” "targets,” “intends,” “likely,” “will,” “should,” “could,” “to be,” ”potential,” “assumptions,” “guidance,” “aspirations,” “future,” “commitments,” “pursues,” “initiatives,” “objectives,” “opportunities,” “strategy” and any similar expressions are intended to identify those assertions as forward-looking statements.
The words “anticipates,” “may,” “can,” “plans,” “believes,” “estimates,” “expects,” “projects,” “targets,” “intends,” “likely,” “will,” “should,” “could,” “to be,” ”potential,” “assumptions,” “guidance,” “aspirations,” “future,” “commitments,” “pursues,” “initiatives,” “objectives,” “opportunities,” “strategy” and any similar expressions are intended to identify those assertions as forward-looking statements.
Recoverable proven and probable mineral reserves were determined from the application of relevant modifying factors to geological data, in order to establish an operational, economically viable mine plan and have been prepared in accordance with the disclosure requirements of Subpart 1300 of Securities and Exchange Commission (SEC) Regulation S-K.
Recoverable proven and probable mineral reserves were determined from the application of relevant modifying factors to geological data, in order to establish an operational, economically viable mine plan, and have been prepared in accordance with the disclosure requirements of Subpart 1300 of U.S. Securities and Exchange Commission Regulation S-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 innovation, some aspects of which we may not be able to control.
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.
Forward-looking statements are all statements other than statements of historical facts, such as plans, projections, or expectations relating to business outlook, strategy, goals or targets; global market conditions; ore grades and milling rates; production and sales volumes; unit net cash costs and operating costs; capital expenditures; operating plans; cash flows; liquidity; PT-FI’s financing, construction and completion of additional domestic smelting capacity in Indonesia in accordance with the terms of its IUPK; extension of PT-FI’s IUPK beyond 2041; our commitment to deliver responsibly produced copper and molybdenum, including plans to implement, validate and maintain validation of our operating sites under specific frameworks; execution of our energy and climate strategies and the underlying assumptions and estimated impacts on our business related thereto; achievement of 2030 climate targets and 2050 net zero aspiration; improvements in operating procedures and technology innovations; exploration efforts and results; development and production activities, rates and costs; future organic growth opportunities; tax rates; export quotas and duties; the impact of copper, gold and molybdenum price changes; the impact of deferred intercompany profits on earnings; mineral reserve and mineral resource estimates; final resolution of settlements associated with ongoing legal proceedings; debt repurchases and the ongoing implementation of our financial policy and future returns to shareholders, including dividend payments (base or variable) and share repurchases.
Forward-looking statements are all statements other than statements of historical facts, such as plans, projections, or expectations relating to business outlook, strategy, goals or targets; global market conditions; ore grades and milling rates; production and sales volumes; unit net cash costs and operating costs; capital expenditures; operating plans; cash flows; liquidity; PT-FI’s construction and completion of additional domestic smelting and refining capacity in Indonesia in accordance with the terms of its IUPK; extension of PT-FI’s IUPK beyond 2041; export licenses; export duties; export volumes; our commitment to deliver responsibly produced copper and molybdenum, including plans to implement, validate and maintain validation of our operating sites under specific frameworks; execution of our energy and climate strategies and the underlying assumptions and estimated impacts on our business and stakeholders related thereto; achievement of 2030 climate targets and 2050 net zero aspiration; improvements in operating procedures and technology innovations and applications; exploration efforts and results; development and production activities, rates and costs; future organic growth opportunities; tax rates; the impact of copper, gold and molybdenum price changes; the impact of deferred intercompany profits on earnings; mineral reserve and mineral resource estimates; final resolution of settlements associated with ongoing legal and environmental proceedings; debt repurchases; and the ongoing implementation of our financial policy and future returns to shareholders, including dividend payments (base or variable) and share repurchases.
Judgments and estimates are based upon currently available facts, existing technology, presently enacted laws and regulations, remediation experience, whether or not we are a potentially responsible party (PRP), the ability of other PRPs to pay their allocated portions and take into consideration reasonably possible outcomes.
Judgments and estimates are based upon currently available facts, existing technology, presently enacted laws and regulations, remediation experience, whether we are a potentially responsible party (PRP), the ability of other PRPs to pay their allocated portions and take into consideration reasonably possible outcomes.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, “Cautionary Statement” below. Cash Dividends and Distributions Paid to Noncontrolling Interests . Cash dividends and distributions paid to noncontrolling interests at our international operations totaled $0.8 billion in 2022 and $0.6 billion in 2021.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, and “Cautionary Statement” below. Cash Dividends and Distributions Paid to Noncontrolling Interests . Cash dividends and distributions paid to noncontrolling interests at our international operations totaled $0.6 billion in 2023 and $0.8 billion in 2022.
Environmental Obligations Refer to Notes 1 and 12, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, for further discussion of environmental obligations, including a summary of changes in our estimated environmental obligations for the three years ended December 31, 2022.
Environmental Obligations Refer to Notes 1 and 12, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, for further discussion of environmental obligations, including a summary of changes in our estimated environmental obligations for the three years ended December 31, 2023.
At December 31, 2022, AROs recorded in our consolidated balance sheet totaled $3.0 billion. Generally, ARO activities are specified by regulations or in permits issued by the relevant governing authority, and management’s judgment is required to estimate the extent and timing of expenditures.
At December 31, 2023, AROs recorded in our consolidated balance sheet totaled $3.0 billion. Generally, ARO activities are specified by regulations or in permits issued by the relevant governing authority, and management’s judgment is required to estimate the extent and timing of expenditures.
Accounting for AROs represents a critical accounting estimate because (i) we will not incur most of these costs for a number of years, requiring us to make estimates over a long period, (ii) reclamation and closure laws and regulations could change in the future and/or circumstances affecting our operations could change, either of which could result in significant changes to our current plans, (iii) our implementation of the Global Industry Standard on Tailings Management, which could result in changes to our plans and the scope of work required (iv) the methods used or required to plug and abandon non-producing oil and gas wellbores, remove platforms, tanks, production equipment and flow lines, and restore the wellsite could change, (v) calculating the fair value of our AROs requires management to estimate projected cash flows, make long-term assumptions about inflation rates, determine our credit-adjusted, risk-free interest rates and determine market risk premiums that are appropriate for our operations and (vi) given the magnitude of our estimated reclamation, mine closure and wellsite abandonment and restoration costs, changes in any or all of these estimates could have a significant impact on our results of operations.
Accounting for AROs 83 Table of Contents represents a critical accounting estimate because (i) we will not incur most of these costs for a number of years, requiring us to make estimates over a long period, (ii) reclamation and closure laws and regulations could change in the future and/or circumstances affecting our operations could change, either of which could result in significant changes to our current plans, (iii) our commitment to implement the Global Industry Standard on Tailings Management could result in changes to our plans and the scope of work required, (iv) the methods used or required to plug and abandon non-producing oil and gas wellbores, remove platforms, tanks, production equipment and flow lines, and restore the wellsite could change, (v) calculating the fair value of our AROs requires management to estimate projected cash flows, make long-term assumptions about inflation rates, determine our credit-adjusted, risk-free interest rates and determine market risk premiums that are appropriate for our operations and (vi) given the magnitude of our estimated reclamation, mine closure and wellsite abandonment and restoration costs, changes in any or all of these estimates could have a significant impact on our results of operations.
Also includes amounts associated with the 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. 113 Table of Contents CAUTIONARY STATEMENT Our discussion and analysis contains forward-looking statements in which we discuss our potential future performance.
Also includes amounts associated with the 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. 113 Table of Contents CAUTIONARY STATEMENT Our discussion and analysis contains forward-looking statements in which we discuss our potential future performance, operations and projects.
The declaration and payment of dividends (base or variable) is at the discretion of our 100 Table of Contents Board and will depend on our financial results, cash requirements, global economic conditions and other factors deemed relevant by our Board. Refer to Item 1A.
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 102 Table of Contents Board. Refer to Item 1A.
Represents income before income taxes and equity in affiliated companies' net earnings. b. In addition to our North America mining operations, the U.S. jurisdiction reflects corporate-level expenses, which include interest expense associated with senior notes, general and administrative expenses, and environmental obligations and shutdown costs. c. Includes valuation allowance release on prior year unbenefited NOLs. d.
Represents income before income taxes, equity in affiliated companies’ net earnings and noncontrolling interests. b. In addition to our North America mining operations, the U.S. jurisdiction reflects corporate-level expenses, which include interest expense associated with senior notes, general and administrative expenses, and environmental obligations and shutdown costs. c. Includes valuation allowance release on prior year unbenefited NOLs.
Based on current market conditions, the base and variable dividends on our common stock are anticipated to total $0.60 per share for 2023 (including the dividends paid on February 1, 2023), comprised of a $0.30 per share base dividend and $0.30 per share variable dividend.
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), comprised of a $0.30 per share base dividend and $0.30 per share variable dividend.
“Legal Proceedings” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, for further discussion of contingencies associated with legal proceedings and other matters.
“Legal Proceedings” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, for further discussion of contingencies associated with legal proceedings and other matters.
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 interest 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 project net debt for additional smelting capacity in Indonesia).
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 interest 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 net project debt for the Indonesia smelter projects).
Gross Profit per Pound of Copper and per Ounce of Gold The following table summarizes the unit net cash costs and gross profit per pound of copper and per ounce of gold at our Indonesia mining operations for the two years ended December 31, 2022.
Gross Profit per Pound of Copper and per Ounce of Gold The following table summarizes the unit net cash costs and gross profit per pound of copper and per ounce of gold at our Indonesia mining operations for the two years ended December 31, 2023.
Our annual report on Form 10-K for the year ended December 31, 2022, also includes forward-looking statements regarding mineral resources not included in proven and probable mineral reserves.
Our annual report on Form 10-K for the year ended December 31, 2023, also includes forward-looking statements regarding mineral resources not included in proven and probable mineral reserves.
Accordingly, no assurance can be given that the estimated mineral resources will become proven and probable mineral reserves. 114 Table of Contents Our annual report on Form 10-K for the year ended December 31, 2022, also contains financial measures such as net debt and unit net cash costs per pound of copper and molybdenum, which are not recognized under U.S.
Accordingly, no assurance can be given that the estimated mineral resources will become proven and probable mineral reserves. 114 Table of Contents Our annual report on Form 10-K for the year ended December 31, 2023, also contains measures such as net debt and unit net cash costs per pound of copper and molybdenum, which are not recognized under U.S. GAAP.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, and “Cautionary Statement” below for further discussion.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, and “Cautionary Statement” below for further discussion.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, for further discussion of our consolidated income taxes.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, for further discussion of our consolidated income taxes.
The effect on deferred income tax assets and liabilities of a change in tax rates or laws is recognized in income in the period in which such changes are enacted. 81 Table of Contents Our operations are in multiple jurisdictions where uncertainties arise in the application of complex tax regulations.
The effect on deferred income tax assets and liabilities of a change in tax rates or laws is recognized in income in the period in which such changes are enacted. Our operations are in multiple jurisdictions where uncertainties arise in the application of complex tax regulations.
Reflects the estimated impact on annual operating costs assuming a 10% increase or decrease in the exchange rate reported at December 31, 2022. b.
Reflects the estimated impact on annual operating costs assuming a 10% increase or decrease in the exchange rate reported at December 31, 2023. b.
We closely monitor market conditions and will continue to adjust our operating plans, including capital expenditures, to protect our liquidity and preserve our asset values, as necessary. Capital expenditures for the Indonesia smelter projects are being funded with proceeds from PT-FI's senior notes and its available revolving credit facility.
We closely monitor market conditions and will continue to adjust our operating plans, including capital expenditures, to protect our liquidity and preserve our asset values, as necessary. Capital expenditures for the Indonesia smelter projects are being funded with the remaining proceeds from PT-FI’s senior notes and availability under its revolving credit facility.
CAPITAL RESOURCES AND LIQUIDITY Our consolidated operating cash flows vary with sales volumes; prices realized from copper, gold and molybdenum sales; production costs; income taxes; other working capital changes; and other factors. See “Consolidated Results” and Item 1A.
CAPITAL RESOURCES AND LIQUIDITY Our consolidated operating cash flows vary with sales volumes; prices realized from copper, gold and molybdenum sales; production costs; income taxes; other working capital changes; and other factors. See “Consolidated Results,” and Item 1A.
The impact of price changes on 2023 consolidated unit net cash costs would approximate $0.04 per pound of copper for each $100 per ounce change in the average price of gold and $0.02 per pound of copper for each $2 per pound change in the average price of molybdenum.
The impact of price changes on consolidated unit net cash costs for the year 2024 would approximate $0.04 per pound of copper for each $100 per ounce change in the average price of gold and $0.02 per pound of copper for each $2 per pound change in the average price of molybdenum.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023.
Smelting & Refining We wholly own and operate the Miami smelter in Arizona, the El Paso refinery in Texas and Atlantic Copper, a smelter and refinery in Spain. Additionally, PT-FI has a 39.5% ownership interest in PT Smelting (refer to Note 3).
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. PT-FI also has a 39.5% ownership interest in PT Smelting (refer to Note 3).
The declaration and payment of dividends (base or variable), and timing and amount of any share repurchases is at the discretion of our Board and management, respectively, and is subject to a number of factors, including maintaining our net debt target, capital availability, our financial results, cash requirements, global economic conditions, changes in laws, contractual restrictions and other factors deemed relevant by our Board or management, as applicable.
The declaration and payment of dividends (base or variable), and timing and amount of any share repurchases are at the discretion of our Board and management, respectively, and are subject to a number of factors, including not exceeding our net debt target, capital availability, our financial results, cash requirements, global economic conditions, changes in laws, contractual restrictions and other factors deemed relevant by our Board or management, as applicable.
During the two-year period ended December 31, 2022, no material impairments of our long-lived mining assets were recorded.
During the two-year period ended December 31, 2023, no material impairments of our long-lived mining assets were recorded.
In December 2022, 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 was paid on February 1, 2023, to shareholders of record as of January 13, 2023.
In December 2023, 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 was paid on February 1, 2024, to shareholders of record as of January 12, 2024.
Represents the combined total for our other mining operations as presented in Note 16. 108 Table of Contents South America Mining Product Revenues, Production Costs and Unit Net Cash Costs Year Ended December 31, 2022 (In millions) By-Product Co-Product Method Method Copper Other a Total Revenues, excluding adjustments $ 4,413 $ 4,413 $ 451 $ 4,864 Site production and delivery, before net noncash and other costs shown below 2,929 2,705 281 2,986 By-product credits (394) — — — Treatment charges 170 170 — 170 Royalty on metals 10 9 1 10 Net cash costs 2,715 2,884 282 3,166 DD&A 408 370 38 408 Metals inventory adjustments 13 12 1 13 Noncash and other costs, net 80 76 4 80 Total costs 3,216 3,342 325 3,667 Other revenue adjustments, primarily for pricing on prior period open sales 35 35 — 35 Gross profit $ 1,232 $ 1,106 $ 126 $ 1,232 Copper sales (millions of recoverable pounds) 1,162 1,162 Gross profit per pound of copper: Revenues, excluding adjustments $ 3.80 $ 3.80 Site production and delivery, before net noncash and other costs shown below 2.52 2.33 By-product credits (0.34) — Treatment charges 0.15 0.14 Royalty on metals 0.01 0.01 Unit net cash costs 2.34 2.48 DD&A 0.35 0.32 Metals inventory adjustments 0.01 0.01 Noncash and other costs, net 0.07 0.07 Total unit costs 2.77 2.88 Other revenue adjustments, primarily for pricing on prior period open sales 0.03 0.03 Gross profit per pound $ 1.06 $ 0.95 Reconciliation to Amounts Reported Metals Production Inventory Revenues and Delivery DD&A Adjustments Totals presented above $ 4,864 $ 2,986 $ 408 $ 13 Treatment charges (170) — — — Royalty on metals (10) — — — Noncash and other costs, net — 80 — — Other revenue adjustments, primarily for pricing on prior period open sales 35 — — — Eliminations and other (1) (5) — — South America mining 4,718 3,061 408 13 Other mining b 24,456 16,186 1,541 16 Corporate, other & eliminations (6,394) (6,206) 70 — As reported in our consolidated financial statements $ 22,780 $ 13,041 $ 2,019 $ 29 a.
Represents the combined total for our other mining operations as presented in Note 16. 109 Table of Contents South America Mining Product Revenues, Production Costs and Unit Net Cash Costs Year Ended December 31, 2022 (In millions) By-Product Co-Product Method Method Copper Other a Total Revenues, excluding adjustments $ 4,413 $ 4,413 $ 451 $ 4,864 Site production and delivery, before net noncash and other costs shown below 2,929 2,705 281 2,986 By-product credits (394) — — — Treatment charges 170 170 — 170 Royalty on metals 10 9 1 10 Net cash costs 2,715 2,884 282 3,166 DD&A 408 370 38 408 Noncash and other costs, net 93 88 5 93 Total costs 3,216 3,342 325 3,667 Other revenue adjustments, primarily for pricing on prior period open sales 35 35 — 35 Gross profit $ 1,232 $ 1,106 $ 126 $ 1,232 Copper sales (millions of recoverable pounds) 1,162 1,162 Gross profit per pound of copper: Revenues, excluding adjustments $ 3.80 $ 3.80 Site production and delivery, before net noncash and other costs shown below 2.52 2.33 By-product credits (0.34) — Treatment charges 0.15 0.14 Royalty on metals 0.01 0.01 Unit net cash costs 2.34 2.48 DD&A 0.35 0.32 Noncash and other costs, net 0.08 0.08 Total unit costs 2.77 2.88 Other revenue adjustments, primarily for pricing on prior period open sales 0.03 0.03 Gross profit per pound $ 1.06 $ 0.95 Reconciliation to Amounts Reported Production Revenues and Delivery DD&A Totals presented above $ 4,864 $ 2,986 $ 408 Treatment charges (170) — — Royalty on metals (10) — — Noncash and other costs, net — 93 — Other revenue adjustments, primarily for pricing on prior period open sales 35 — — Eliminations and other (1) (5) — South America mining 4,718 3,074 408 Other mining b 24,456 16,202 1,541 Corporate, other & eliminations (6,394) (6,206) 70 As reported in our consolidated financial statements $ 22,780 $ 13,070 $ 2,019 a.
Includes consolidated debt of $3.0 billion and consolidated cash and cash equivalents of $1.8 billion as of December 31, 2022, and consolidated debt of $0.4 billion and consolidated cash and cash equivalents of $0.2 billion as of December 31, 2021. 105 Table of Contents PRODUCT REVENUES AND PRODUCTION COSTS Mining Product Revenues and Unit Net Cash Costs Unit net cash costs per pound of copper and molybdenum are measures intended to provide investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for the respective operations.
Includes consolidated debt of $3.0 billion at both dates and consolidated cash and cash equivalents of $0.2 billion as of December 31, 2023, and $1.8 billion as of December 31, 2022. 105 Table of Contents PRODUCT REVENUES AND PRODUCTION COSTS Mining Product Revenues and Unit Net Cash Costs Unit net cash costs per pound of copper and molybdenum are measures intended to provide investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for the respective operations.
PT-FI’s expected average unit net cash costs for the year 2023 would change by approximately $0.10 per pound of copper for each $100 per ounce change in the average price of gold.
PT-FI’s average unit net cash costs for the year 2024 would change by approximately $0.10 per pound of copper for each $100 per ounce change in the average price of gold.
We recognized foreign currency translation gains on balances denominated in foreign currencies totaling $9 million in 2022 and $66 million in 2021. Generally, our operating results are positively affected when the U.S. dollar strengthens in relation to those foreign currencies and are adversely affected when the U.S. dollar weakens in relation to those foreign currencies.
We recognized foreign currency translation gains on balances denominated in foreign currencies totaling $20 million in 2023 and $9 million in 2022. Generally, our operating results are positively affected when the U.S. dollar strengthens in relation to those foreign currencies and are adversely affected when the U.S. dollar weakens in relation to those foreign currencies.
The small number of approved, large-scale projects beyond those that have been announced, the long lead times required to permit and build new mines and declining ore grades at existing operations continue to highlight the fundamental supply challenges for copper. 79 Table of Contents This graph presents London PM gold prices from January 2013 through December 2022.
The small number of approved, large-scale projects beyond those that have been announced, the long lead times required to permit and build new mines and declining ore grades at existing operations continue to highlight the fundamental supply challenges for copper. 80 Table of Contents This graph presents London PM gold prices from January 2014 through December 2023.
Unit net cash costs per pound of copper is a measure intended to provide investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations.
We believe unit net cash costs per pound of copper is a measure that provides investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations.
At December 31, 2022, environmental obligations recorded in our consolidated balance sheet totaled $1.7 billion, which reflect obligations for environmental liabilities attributed to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) or analogous state programs and for estimated future costs associated with environmental matters.
At December 31, 2023, environmental obligations recorded in our consolidated balance sheet totaled $1.9 billion, which reflect obligations for environmental liabilities attributed to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 or analogous state programs and for estimated future costs associated with environmental matters.
Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing. b. Includes gold and silver product revenues and production costs. c. Includes charges totaling $32 million ($0.02 per pound of copper) for feasibility and optimization studies.
Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing. b. Includes gold and silver product revenues and production costs. c. Includes charges totaling $107 million ($0.08 per pound of copper) for feasibility and optimization studies. d.
As a member company, we are required to implement the 10 Mining Principles that define good ESG practices, and associated position statements, while also meeting 39 performance expectations and producing an externally verified sustainability report in accordance with the Global Reporting Initiative Sustainability Reporting Standards subject to the ICMM Assurance & Validation Procedure. 2021 Annual Report on Sustainability .
As a member company, we are required to implement the 10 Mining Principles that define good ESG practices, and associated position statements, while also meeting 39 performance expectations and producing an externally verified sustainability report utilizing the Global Reporting Initiative Sustainability Reporting Standards subject to the ICMM Assurance & Validation Procedure. 2022 Annual Report on Sustainability .
OUTLOOK Our financial results vary as a result of fluctuations in market prices primarily for copper, gold and, to a lesser extent, molybdenum, as well as other factors. World market prices for these commodities have fluctuated historically and are affected by numerous factors beyond our control.
OUTLOOK Our financial results vary as a result of fluctuations in market prices primarily for copper, gold and, to a lesser extent, molybdenum, as well as other factors. World market prices for these commodities have fluctuated historically and are affected by numerous factors beyond our control. Refer to “Markets,” and Item 1A.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022. 78 Table of Contents 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 2013 through December 2022.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023. 79 Table of Contents 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 December 2023.
Includes 50 million pounds from our North America and South America copper mines and 30 million pounds from our Molybdenum mines.
Includes 55 million pounds from our North America and South America copper mines and 30 million pounds from our Molybdenum mines.
During the period from January 2013 through December 2022, the London Metal Exchange (LME) copper settlement price varied from a low of $1.96 per pound in 2016 to a record high of $4.87 per pound in 2022; the London Bullion Market Association (London) PM gold price fluctuated from a low of $1,049 per ounce in 2015 to a record high of $2,067 per ounce in 2020, and the Platts Metals Daily Molybdenum Dealer Oxide weekly average price ranged from a low of $4.46 per pound in 2015 to a high of $31.37 per pound in 2022.
During the period from January 2014 through December 2023, the London Metal Exchange (LME) copper settlement price varied from a low of $1.96 per pound in 2016 to a record high of $4.87 per pound in 2022; the London Bullion Market Association (London) PM gold price fluctuated from a low of $1,049 per ounce in 2015 to a record high of $2,078 per ounce in 2023, and the Platts Metals Daily Molybdenum Dealer Oxide weekly average price ranged from a low of $4.46 per pound in 2015 to a high of $37.42 per pound in 2023.
Changes in projected sales volumes and average prices during 2023 would incur tax impacts at estimated effective rates of 39% for Peru, 38% for Indonesia and 0% for the U.S., which excludes any potential impact from the Act.
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 Act.
PT-FI is also advancing a mill recovery project with the installation of a new copper cleaner circuit that is expected to be completed in 2024, which is expected to provide incremental metal production of approximately 60 million pounds of copper and 40 thousand ounces of gold per year. Kucing Liar .
PT-FI 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.
Following are the favorable impacts of net adjustments to the prior years’ provisionally priced copper sales for the years ended December 31 (in millions, except per share amounts): 2022 2021 Revenues $ 60 $ 169 Net income attributable to common stock $ 25 $ 65 Net income per share attributable to common stock $ 0.02 $ 0.04 At December 31, 2022, we had provisionally priced copper sales at our copper mining operations totaling 535 million pounds of copper (net of intercompany sales and noncontrolling interests) recorded at an average price of $3.80 per pound, subject to final pricing over the next several months.
Following are the favorable impacts of net adjustments to the prior years’ provisionally priced copper sales for the years ended December 31 (in millions, except per share amounts): 2023 2022 Revenues $ 183 $ 60 Net income attributable to common stock $ 62 $ 25 Net income per share attributable to common stock $ 0.04 $ 0.02 At December 31, 2023, we had provisionally priced copper sales at our copper mining operations totaling 223 million pounds of copper (net of intercompany sales and noncontrolling interests) recorded at an average price of $3.87 per pound, subject to final pricing over the next several months.
Refer to “Outlook” for projected molybdenum sales volumes. Unit Net Cash Costs . Unit net cash costs per pound of copper is a measure intended to provide investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations.
Refer to “Outlook” for projected molybdenum sales volumes. Unit Net Cash Costs . We believe unit net cash costs per pound of copper is a measure that provides investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2022, for further discussion of financial risks associated with fluctuations in the market prices of the commodities we sell. 103 Table of Contents During 2022, our mined copper was sold 61% in concentrate, 18% as cathode and 21% as rod from North America operations.
“Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2023, for further discussion of financial risks associated with fluctuations in the market prices of the commodities we sell. 103 Table of Contents During 2023, our mined copper was sold 51% in concentrate, 27% as cathode and 22% as rod from North America operations.
Cash 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 December 31, 2022 (in billions): Cash at domestic companies $ 4.9 Cash at international operations 3.2 Total consolidated cash and cash equivalents 8.1 Cash for Indonesia smelter projects (1.8) a Noncontrolling interests’ share (0.4) Cash, net of noncontrolling interests’ share 5.9 Withholding taxes (0.1) Net cash available $ 5.8 a.
Cash Following is a summary of the U.S. and international components of consolidated cash and cash equivalents available to the parent company, excluding cash committed for the Indonesia smelter projects and net of noncontrolling interests’ share, taxes and other costs at December 31, 2023 (in billions): Cash at domestic companies $ 2.7 Cash at international operations 2.1 a Total consolidated cash and cash equivalents 4.8 Cash for Indonesia smelter projects (0.2) b Noncontrolling interests’ share (0.9) Cash, net of noncontrolling interests’ share 3.7 Withholding taxes (0.1) Net cash available $ 3.6 a.
Unit net cash costs per pound of molybdenum is a measure intended to provide investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations.
We believe unit net cash costs per pound of copper is a measure that provides investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations.
Includes favorable adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $60 million ($25 million to net income attributable to common stock or $0.02 per share) in 2022 and $169 million ($65 million to net income attributable to common stock or $0.04 per share) in 2021 (refer to Note 14). c.
Includes favorable adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $183 million ($62 million to net income attributable to common stock or $0.04 per share) in 2023 and $60 million ($25 million to net income attributable to common stock or $0.02 per share) in 2022 (refer to Note 14). c.
Such payment is recorded as a receivable if we believe the amount is collectible. Refer to Note 12 for further discussion. A valuation allowance is provided for those deferred income tax assets for which the weight of available evidence suggests that the related benefits will not be realized.
Such payment is recorded as a receivable if we believe the amount is collectible. Refer to Note 12 for further discussion. A valuation allowance is provided for those deferred income tax assets for which available information, including positive and negative evidence, suggests that the related benefits will not be realized.
A large portion of the capital expenditures relate to projects that are expected to add significant production and cash flow in future periods, enabling us to continue to generate operating cash flows exceeding capital expenditures in future years. Refer to “Outlook” for further discussion of projected capital expenditures for 2023. 101 Table of Contents Proceed from Sales of Assets .
A large portion of the capital expenditures relate to projects that are expected to add significant production and cash flow in future periods, enabling us to continue to generate operating cash flows exceeding capital expenditures in future years. Refer to “Outlook” for further discussion of projected capital expenditures for 2024. Proceeds from Sales of Assets .
This section of our Form 10-K discusses the results of operations for the years 2022 and 2021 and comparisons between these years. Discussion of the results of operations for the year 2020 and comparisons between the years 2021 and 2020 are not included in this Form 10-K and can be found in Items 7. and 7A.
Discussion of the results of operations for the year 2021 and comparisons between the years 2022 and 2021 are not included in this Form 10-K and can be found in Items 7. and 7A.
We have not elected to permanently reinvest earnings from our foreign subsidiaries, and we have recorded deferred tax liabilities for foreign earnings that are available to be repatriated to the U.S. From time to time, our foreign subsidiaries distribute earnings to the U.S. through dividends that are subject to applicable withholding taxes and noncontrolling interests’ share. See Item 1A.
We have not 101 Table of Contents elected to permanently reinvest earnings from our foreign subsidiaries, and we have recorded deferred tax liabilities for foreign earnings that are available to be repatriated to the U.S. From time to time, our foreign subsidiaries distribute earnings to the U.S. through dividends that are subject to applicable withholding taxes and noncontrolling interests’ share.
Item 6. Reserved. Items 7. and 7A. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk. In Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk (MD&A), “we,” “us” and “our” refer to Freeport-McMoRan Inc. and its consolidated subsidiaries.
In Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk (MD&A), “we,” “us” and “our” refer to Freeport-McMoRan Inc. and its consolidated subsidiaries.
Prior Year Provisionally Priced Copper Sales . Net favorable adjustments to prior years’ provisionally priced copper sales ( i.e., provisionally priced copper sales at December 31, 2021 and 2020) recorded in consolidated revenues totaled $60 million in 2022 and $169 million in 2021.
Net favorable adjustments to prior years’ provisionally priced copper sales ( i.e., provisionally priced copper sales at December 31, 2022 and 2021) recorded in consolidated revenues totaled $183 million in 2023 and $60 million in 2022.
Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing. b. Includes $0.06 per pound of copper in 2022 and $0.02 per pound of copper in 2021 for feasibility and optimization studies. c.
Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing. b. Includes charges totaling $0.08 per pound of copper in 2023 and $0.06 per pound of copper in 2022 for feasibility and optimization studies.
The following schedules are presentations under both the by-product and co-product methods together with reconciliations to amounts reported in our consolidated financial statements. 106 Table of Contents North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs Year Ended December 31, 2022 (In millions) By-Product Co-Product Method Method Copper Molybdenum a Other b Total Revenues, excluding adjustments $ 6,007 $ 6,007 $ 512 $ 127 $ 6,646 Site production and delivery, before net noncash and other costs shown below 3,799 3,478 383 96 3,957 By-product credits (481) — — — — Treatment charges 149 144 — 5 149 Net cash costs 3,467 3,622 383 101 4,106 DD&A 409 377 26 6 409 Metals inventory adjustments 16 14 2 — 16 Noncash and other costs, net 167 c 152 12 3 167 Total costs 4,059 4,165 423 110 4,698 Other revenue adjustments, primarily for pricing on prior period open sales (13) (13) — — (13) Gross profit $ 1,935 $ 1,829 $ 89 $ 17 $ 1,935 Copper sales (millions of recoverable pounds) 1,472 1,472 Molybdenum sales (millions of recoverable pounds) a 29 Gross profit per pound of copper/molybdenum: Revenues, excluding adjustments $ 4.08 $ 4.08 $ 17.87 Site production and delivery, before net noncash and other costs shown below 2.58 2.36 13.35 By-product credits (0.33) — — Treatment charges 0.10 0.10 — Unit net cash costs 2.35 2.46 13.35 DD&A 0.28 0.26 0.90 Metals inventory adjustments 0.01 0.01 0.05 Noncash and other costs, net 0.12 c 0.10 0.47 Total unit costs 2.76 2.83 14.77 Other revenue adjustments, primarily for pricing on prior period open sales (0.01) (0.01) — Gross profit per pound $ 1.31 $ 1.24 $ 3.10 Reconciliation to Amounts Reported Metals Production Inventory Revenues and Delivery DD&A Adjustments Totals presented above $ 6,646 $ 3,957 $ 409 $ 16 Treatment charges (22) 127 — — Noncash and other costs, net — 167 — — Other revenue adjustments, primarily for pricing on prior period open sales (13) — — — Eliminations and other 99 110 1 — North America copper mines 6,710 4,361 410 16 Other mining d 22,464 14,886 1,539 13 Corporate, other & eliminations (6,394) (6,206) 70 — As reported in our consolidated financial statements $ 22,780 $ 13,041 $ 2,019 $ 29 a.
Represents the combined total for our other mining operations as presented in Note 16. 107 Table of Contents North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs Year Ended December 31, 2022 (In millions) By-Product Co-Product Method Method Copper Molybdenum a Other b Total Revenues, excluding adjustments $ 6,007 $ 6,007 $ 512 $ 127 $ 6,646 Site production and delivery, before net noncash and other costs shown below 3,799 3,478 383 96 3,957 By-product credits (481) — — — — Treatment charges 149 144 — 5 149 Net cash costs 3,467 3,622 383 101 4,106 DD&A 409 377 26 6 409 Noncash and other costs, net 183 c 166 14 3 183 Total costs 4,059 4,165 423 110 4,698 Other revenue adjustments, primarily for pricing on prior period open sales (13) (13) — — (13) Gross profit $ 1,935 $ 1,829 $ 89 $ 17 $ 1,935 Copper sales (millions of recoverable pounds) 1,472 1,472 Molybdenum sales (millions of recoverable pounds) a 29 Gross profit per pound of copper/molybdenum: Revenues, excluding adjustments $ 4.08 $ 4.08 $ 17.87 Site production and delivery, before net noncash and other costs shown below 2.58 2.36 13.35 By-product credits (0.33) — — Treatment charges 0.10 0.10 — Unit net cash costs 2.35 2.46 13.35 DD&A 0.28 0.26 0.90 Noncash and other costs, net 0.13 c 0.11 0.52 Total unit costs 2.76 2.83 14.77 Other revenue adjustments, primarily for pricing on prior period open sales (0.01) (0.01) — Gross profit per pound $ 1.31 $ 1.24 $ 3.10 Reconciliation to Amounts Reported Production Revenues and Delivery DD&A Totals presented above $ 6,646 $ 3,957 $ 409 Treatment charges (22) 127 — Noncash and other costs, net — 183 — Other revenue adjustments, primarily for pricing on prior period open sales (13) — — Eliminations and other 99 110 1 North America copper mines 6,710 4,377 410 Other mining d 22,464 14,899 1,539 Corporate, other & eliminations (6,394) (6,206) 70 As reported in our consolidated financial statements $ 22,780 $ 13,070 $ 2,019 a.
Based on exchange rates at December 31, 2022. 104 Table of Contents Interest Rate Risk At December 31, 2022, we had total debt maturities based on principal amounts of $10.7 billion, substantially all of which was fixed-rate debt.
Based on exchange rates at December 31, 2023. 104 Table of Contents Interest Rate Risk At December 31, 2023, we had total debt maturities based on principal amounts of $9.5 billion, substantially all of which was fixed-rate debt.

… 351 more changes not shown on this page.

Other FCX 10-K year-over-year comparisons