| Will Freeport-McMoRan’s Growth Projects Pay Off? | |
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Freeport-McMoRan’s 2Q15 Earnings: An Investor's Guide (Continued from Prior Part) Freeport-McMoRan’s debt situation
Previously, we looked at Freeport-McMoRan’s (FCX) precarious debt situation. The company has generated negative free cash flow for five consecutive quarters. The negative free cash flows are partially due to falling commodity prices, which have negatively impacted Freeport’s earnings.
Another factor contributing to Freeport’s negative free cash flow is the massive capital expenditure (capex) Freeport is incurring.
Capital expenditure
The above graph shows Freeport’s capex over the last few quarters. Freeport has reduced its capex budget for 2015, but it’s still quite substantial. Freeport has a capex budget of $6.3 billion in 2015. It expects to spend $3.5 billion on mining projects and $2.8 billion in the oil and gas business.
Major growth projects
Expansion of the Cerro Verde mill is a major growth project Freeport is pursuing. Freeport owns a 53.56% stake in Cerro Verde, which is located in Peru (ILF). The total project cost for this expansion is $4.6 billion. Freeport has already incurred $3.9 billion in costs.
The Cerro Verde project, which is ~87% complete, is expected to come online later in 2015. It’s expected to become the world’s largest copper concentration capacity. Freeport expects incremental annual production of 600 million pounds of copper and 15 million pounds of molybdenum after the completion of the project.
Freeport is also expected to invest $15 billion in its Grasberg mine in Indonesia (EIDO). However, this will only happen if Freeport is able to sign a long-term agreement with the Indonesian government. Rio Tinto (RIO) is Freeport’s partner in the Grasberg mine.
Newmont Mining (NEM) and Freeport are the leading copper producers in Indonesia.
In the next part, we’ll look at Freeport’s oil and gas projects.
Continue to Next Part Browse this series on Market Realist:
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Freeport McMoRan Copper and Gold Inc.
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PRODUCTEUR |
CODE : FCX |
ISIN : US35671D8570 |
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ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Freeport McMoran est une société de production minière d'or et de cuivre basée aux Etats-Unis D'Amerique. Freeport McMoran est productrice d'or, de cuivre, d'argent, de cobalt et de molybdène au Chili, au Perou, en Indonesie et en Republique Democratique Du Congo, en développement de projets de cuivre au Perou, et détient divers projets d'exploration au Chili. Ses principaux projets en production sont CANDELARIA, EL ABRA, CHINO - MILL, HENDERSON, MIAMI - ROM LEACH, MORENCI - MILL, OJOS DEL SALADO, MORENCI et MORENCI - ROM LEACH au Chili, GRASBERG, SIERRITA et BAGDAD en Indonesie, TENKE FUNGURUME et TYRONE en Republique Democratique Du Congo et CERRO VERDE au Perou, son principal projet en développement est SAFFORD au Perou et ses principaux projets en exploration sont BAGDAD - ROM LEACH et CHINO - ROM LEACH au Perou et CERRO VERDE - MILL, CERRO VERDE - CRUSHED LEACH, CERRO VERDE - ROM LEACH, EL ABRA - ROM LEACH et CLIMAX au Chili. Freeport McMoran est cotée aux Etats-Unis D'Amerique et en Allemagne. Sa capitalisation boursière aujourd'hui est 69,5 milliards US$ (65,2 milliards €). La valeur de son action a atteint son plus bas niveau récent le 06 mars 2020 à 10,00 US$, et son plus haut niveau récent le 23 avril 2024 à 48,02 US$. Freeport McMoran possède 1 448 000 000 actions en circulation. |