Freeport McMoran at Deutsche Bank Conference

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Kathleen Quirk – EVP & CFO

Seeing global growth continue at a moderate pace

“We are seeing the U.S continuing to grow at a moderate rate, and we are seeing stimulus activity help economies in Europe and Japan, and also talk about stimulus in China.”

The swing for copper comes from the supply side though

“But the real underpinning of the market comes from the supply side. Demand — copper is very, very significant in the economy, it’s very important to the global economy. But it’s a market where the supply side is constrained.

You see things like disruptions going on all the time, labor disruptions, weather related issues, technical issues, political issues; there is a whole host of things that impact supply.”

Market conditions have led to under-development

“the market conditions over the last few years have been such that no significant new projects are being developed. So it’s going to create a gap in copper supply as we go forward. We think that’s going to be constructive for the market and where we’re positioned at FCX; we’re very well positioned to participate in this with our large low-cost ore bodies with expansion potential.”

Demand growth is expected to outstrip supply over next 10 years

“This is from Wood Mackenzie. You look over the next 10 years; they’re assuming global growth averaging about 2.5%. That works out to 7.6 million tonnes of copper demand over the same period the existing mines are expected to fall by 3.1 million tonnes. So you need over 10 million tonnes of new supply to be able to make up for this. And that is significant, that’s a significant percentage of today’s supply — of today’s mine production. In 2014, the top 10 mines in the world produced less than 5 million tonnes. So you make it a lot of big mines to be able to meet the shortfall.”

IPOing the oil and gas business

“Well we are working on a registration statement that would be filed, that would give us the opportunity to consider the IPO this fall and so, we expect to be filing a S-1 registration statement this summer, and we’ll have the opportunity to consider in the fall. ”

Going to sell less than 20% of it though

“as I mentioned we’ll file the S-1 during the summer, and what we’re talking about is selling a minority interest, the minority position in the oil and gas subsidiary. So it would be somewhere and likely below 20% because we do get — we do have some advantages, some tax advantages of consolidating that entity. So it would likely be less than the 20% that we sell through public.”

Industry production has not met expectations this year

“most market observers are expecting a small surplus this year. Now that started out higher and over time has declined because production has not — from the industry has not met expectation.”

It’s been very hard to bring on new supply

“Its very, very difficult to increase copper production as we saw, we’ve had incentive pricing for several years, back 2010, ’11, ’12 you had prices above $3 averaging between almost $4 in some years, and there is a lot of capital available to our industry. Lot of big companies in our industry interested in copper and even though there was a lot of desire to expand copper production. It really has not been a meaningful increase in production because mines are aging and production declines at the same time. So, again we just reiterate our view that this is, this is one of the most positive commodities from a fundamental standpoint that you could be in “