Freeport McMoRan Inc.

Freeport McMoRan Inc. is a senior copper producer headquartered in Phoenix, United States, operating primarily in USA and Indonesia. The company's portfolio consists of 12 projects, comprising 9 operating mines and 3 expansion projects. Key assets include Cerro Verde, Grasberg, and Morenci. The business model is centered on being a fully integrated international metals producer, operating large-scale, long-lived assets. The enterprise's operational approach emphasizes vertical integration, with capabilities extending from upstream extraction to downstream processing facilities, including smelters, refineries, and rod mills. This structure allows for the internal processing of a majority of its mined materials into finished or semi-finished products. A key competitive advantage stems from the application of advanced technology and data analytics to enhance operational efficiency. A significant initiative involves an innovative leach process that incorporates new applications and technologies to increase metal recovery from stockpiled materials. The company has demonstrated a commitment to automation, highlighted by the conversion of a haul truck fleet at one of its major sites to a fully autonomous system, an industry first in its primary operating jurisdiction. This focus on technological advancement aims to improve efficiencies, reduce costs, and shorten project lead times. The operational portfolio benefits from shared infrastructure and technical expertise, enabling synergies across its asset base.

Strategic priorities are centered on disciplined organic growth and operational excellence to solidify its position as a leader in its primary market. The organization is advancing a multi-tiered pipeline of near-term, medium-term, and longer-term growth options embedded within its existing asset base. A core element of the strategy involves leveraging innovation to improve efficiencies, reduce costs, and lower the capital intensity of its projects. This includes scaling a high-potential innovative leach initiative and advancing brownfield expansion opportunities. Management is also focused on securing long-term mining rights to unlock additional growth options in key districts. The financial policy is aligned with strategic objectives, emphasizing a strong balance sheet, providing cash returns to shareholders through a performance-based payout framework, and making disciplined investments in value-enhancing growth projects. Capital allocation is guided by this framework, which balances shareholder returns with debt reduction and investments in future growth, subject to maintaining a target net debt level. The enterprise actively pursues feasibility and optimization studies for potential future expansion projects to enhance optionality and position the business for long-term growth.

Executive leadership is undergoing a planned transition, with the President assuming the additional role of Chief Executive Officer in June 2024, succeeding the long-serving CEO who will continue as Chairman of the Board. The board of directors is composed of 11 members, including a Lead Independent Director. Governance is structured through 4 primary committees: Audit, Compensation, Governance, and Corporate Responsibility, which provide oversight on key aspects of the business. The board actively reviews the company's financial policy and the structure of its performance-based shareholder payout framework at least annually. The leadership philosophy emphasizes strong execution of operating plans, enhancing productivity, and disciplined management of costs and capital. This is demonstrated by the focus on achieving operational targets and advancing value-driven initiatives across the organization. The management team's resilience was tested by an operational setback at a new facility, where they responded quickly to develop and implement recovery plans. The enterprise has now achieved investment grade ratings from all 3 major rating agencies, reflecting the successful execution of its plans over a multi-year period and its strong financial profile.

The sustainability strategy, titled "Accelerate the Future, Responsibly," is integrated with business objectives and focuses on enhancing responsible production practices. The organization is a founding member of the International Council on Mining and Metals and is committed to implementing its Mining Principles framework. All operating sites have achieved and are committed to maintaining key industry-specific responsible production assurance frameworks. A core environmental commitment involves advancing climate initiatives, including a plan to transition a major energy source from coal to natural gas to meaningfully reduce greenhouse gas emissions. Environmental stewardship is also demonstrated through a wastewater treatment program that supports clean water for a major city, improving the water quality of a local river. The company has an unwavering commitment to safety, achieving its lowest incident rate in over a decade in 2024, while transparently reporting on workplace fatalities. Social commitments include working collaboratively with stakeholders to maintain its social license to operate, supporting shared value creation, and promoting human rights.

The corporate structure involves significant joint ventures and partially owned, consolidated subsidiaries. The company holds a 48.76% ownership interest in a key subsidiary, PT-FI, which it consolidates due to governance arrangements established in a 2018 transaction with a state-owned enterprise, MIND ID, that give it control over operations. This arrangement also defines the attribution of economic interests, which shifted from approximately 81% for the company through 2022 to its direct equity ownership percentage thereafter. Another major operation is held through a 72% undivided interest in an unincorporated joint venture with partners Sumitomo and SMM Morenci, Inc. In 2024, the company increased its ownership in another key subsidiary, Cerro Verde, to 55.08% from 53.56% through a share purchase. The enterprise also holds a 66% ownership interest in a smelting and refining joint venture, PT Smelting, with Mitsubishi Materials Corporation, after loans to fund a 2023 expansion project were converted to equity in 2024. As of December 31, 2024, major institutional shareholders included The Vanguard Group with an 8.3% stake, BlackRock, Inc. with 7.7%, and Capital Research Global Investors with 5.8%.