Freeport-McMoRan Copper & Gold Inc. Reports Second-Quarter and Six-Month 2010 Results

Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX):

• Net income attributable to common stock for second-quarter 2010
  was $649 million, $1.40 per share, compared with net income of $588
  million, $1.38 per share, for second-quarter 2009. Net income
  attributable to common stock for the first six months of 2010 was $1.5
  billion, $3.40 per share, compared with $631 million, $1.54 per share,
  for the first six months of 2009.
  
• Consolidated sales from mines for second-quarter 2010 totaled
  914 million pounds of copper, 298 thousand ounces of gold and 16
  million pounds of molybdenum, compared with 1.1 billion pounds of
  copper, 837 thousand ounces of gold and 16 million pounds of
  molybdenum for second-quarter 2009.
  
• Consolidated sales from mines for the year 2010 are expected to
  approximate 3.8 billion pounds of copper, 1.8 million ounces of gold
  and 63 million pounds of molybdenum, including 970 million pounds of
  copper, 410 thousand ounces of gold and 15 million pounds of
  molybdenum for third-quarter 2010.
  
• Consolidated unit net cash costs (net of by-product credits)
  averaged $0.97 per pound for second-quarter 2010, compared with $0.43
  per pound for second-quarter 2009. Assuming average prices of $1,200
  per ounce for gold and $14 per pound for molybdenum for the second
  half of 2010, consolidated unit net cash costs (net of by-product
  credits) are estimated to average approximately $0.86 per pound for
  the year 2010. Quarterly unit net cash costs will vary with
  fluctuations in sales volumes of copper and by-products.
  
• Operating cash flows totaled $1.1 billion for second-quarter
  2010 and $2.9 billion for the first six months of 2010. Using
  estimated 2010 sales volumes and assuming average prices of $3.00 per
  pound for copper, $1,200 per ounce for gold and $14 per pound for
  molybdenum for the second half of 2010, operating cash flows for the
  year 2010 are estimated to exceed $5 billion.
  
• Capital expenditures totaled $296 million for second-quarter
  2010 and $527 million for the first six months of 2010. FCX currently
  expects capital expenditures to approximate $1.7 billion for the year
  2010, including $0.9 billion for sustaining capital and $0.8 billion
  for major projects. A number of studies are ongoing, which may result
  in increased capital spending programs.
  
• 
  At June 30, 2010, total debt approximated $4.8 billion and consolidated
  cash approximated $3.0 billion. During the second quarter of 2010,
  FCX repaid $1.3 billion in debt, including the April 1^st
  redemption of $1.0 billion of outstanding Senior Floating Rate Notes
  due 2015.
  
• 
  During the second quarter of 2010, FCX′s 6 ¾% Mandatory Convertible
  Preferred Stock converted into 39 million shares of FCX common
  stock.
  
• 
  FCX′s Board of Directors declared a common stock dividend of
  $0.30 per share payable on August 1, 2010, to holders of record as of
  July 15, 2010. As previously announced, during the second quarter of
  2010, FCX′s Board of Directors authorized an increase in the annual
  cash dividend on its common stock from $0.60 per share to $1.20 per
  share ($0.30 per share quarterly).
  

Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) reported second-quarter
2010 net income attributable to common stock of $649 million, $1.40 per
share, compared with net income of $588 million, $1.38 per share, for
the second quarter of 2009. For the six months ended June 30, 2010, FCX
reported net income attributable to common stock of $1.5 billion, $3.40
per share, compared with $631 million, $1.54 per share, in the 2009
six-month period.

James R. Moffett, Chairman of the Board, and Richard C. Adkerson,
President and Chief Executive Officer, said, 'Our second-quarter results
reflect continued strong production and cost management throughout our
global portfolio of mining operations.During the quarter, we
executed our operating plans effectively, strengthened our balance sheet
and advanced projects to enhance our future growth options.We
remain positive about the outlook for our business based on the
fundamentals of global supply and demand.We anticipate
generating strong cash flows, which would enable us to invest in future
growth and return cash to shareholders.?

OPERATIONS

Consolidated. Second-quarter 2010 consolidated copper sales of
914 million pounds were higher than the April 2010 estimate of 830
million pounds but lower than the second-quarter 2009 copper sales of
1.1 billion pounds. The variance to the April 2010 estimate primarily
reflects favorable production performance in North and South America and
Indonesia and the timing of shipments, principally in North America. The
variance to the 2009 period primarily reflects the anticipated lower
copper ore grades at Grasberg resulting from planned mine sequencing and
anticipated lower sales from South America mines, partially offset by
higher sales from the Tenke Fungurume mine in Africa.

Second-quarter 2010 consolidated gold sales of 298 thousand ounces were
higher than the April 2010 estimate of 270 thousand ounces but
significantly lower than the second-quarter 2009 gold sales of 837
thousand ounces. The favorable variance to the April 2010 estimate
primarily reflects timing of mine sequencing at Grasberg. The variance
to the 2009 period primarily reflects anticipated lower gold ore grades
at Grasberg resulting from planned mine sequencing.

Consolidated molybdenum sales totaled 16 million pounds in each of the
second quarter periods. The second-quarter 2010 sales were higher than
the April 2010 estimate of 15 million pounds because of improved demand
in the chemicals sector.

Consolidated unit site production and delivery costs averaged $1.41 per
pound of copper in the second quarter of 2010, compared with
second-quarter 2009 unit costs of $1.04 per pound. Second-quarter 2010
unit net cash costs, net of by-product credits, averaged $0.97 per
pound, compared with $0.43 per pound in the year-ago period. The higher
unit net cash costs primarily reflected anticipated lower copper and
gold volumes at Grasberg and South America, partly offset by higher
by-product gold and molybdenum prices.

Assuming average prices of $1,200 per ounce for gold and $14 per pound
for molybdenum for the second half of 2010 and using current 2010 sales
and costs estimates; consolidated unit net cash costs (net of by-product
credits and including Tenke Fungurume) are expected to average
approximately $0.86 per pound for the year 2010. Quarterly unit net cash
costs will vary with fluctuations in sales volumes. Unit net cash costs
for 2010 would change by approximately $0.01 per pound for each $50 per
ounce change in the average price of gold for the second half of 2010
and by approximately $0.005 per pound for each $2 per pound change in
the average price of molybdenum for the second half of 2010.

Development Activities. FCX has significant reserves and future
development opportunities within its portfolio of assets. At December
31, 2009, in addition to estimated proven and probable reserves of 104
billion pounds of copper (determined using a long-term average price of
$1.60 per pound for copper), FCX identified estimated mineralized
material (assessed using a long-term average price of $2.00 per pound
for copper) with incremental contained copper of an additional 122
billion pounds. FCX continues to evaluate opportunities to convert this
material into reserves, future production volumes and cash flow.

FCX is undertaking major development projects, including the development
of the El Abra sulfide reserves and the massive underground ore bodies
at Grasberg. FCX is also advancing development activities at the Climax
primary molybdenum project.

In addition, studies are under way to evaluate the potential to more
than double the concentrator capacity at the large Cerro Verde mine, a
major mill project in the El Abra district, various mill projects to
process significant sulfide ore in North America and staged expansion
options at Tenke Fungurume. The advancement of these studies will
provide flexibility in initiating expansion projects as market
conditions warrant, enabling FCX to continue to maintain its position as
one of the largest copper producers in the world.

North America Copper Mines. FCX operates six open-pit copper
mines in North America (Morenci, Sierrita, Bagdad, Safford and Miami in
Arizona and Tyrone in New Mexico). By-product molybdenum is produced
primarily at Sierrita and Bagdad. All of the North America mining
operations are wholly owned, except for Morenci. FCX records its 85
percent joint venture interest in Morenci using the proportionate
consolidation method.

Second-quarter 2010 consolidated copper sales in North America of 289
million pounds were higher than second-quarter 2009 sales of 281 million
pounds.

For the year 2010, FCX expects sales from North America copper mines to
approximate 1.1 billion pounds of copper, compared with 1.2 billion
pounds of copper for 2009. FCX is increasing mining and milling rates at
its Morenci mine and is restarting its Miami mine, which are expected to
result in higher production in future periods (see 'Operating and
Development Activities? below).

North America unit site production and delivery costs were higher in the
second quarter of 2010, compared with the second quarter of 2009,
primarily because of higher input costs and increased mining and milling
activities at certain mines. Second-quarter 2010 unit net cash costs
benefited from higher by-product credits primarily because of higher
molybdenum prices.

Based on current operating plans, assuming an average molybdenum price
of $14 per pound for the second half of 2010 and using current 2010
sales and costs estimates, FCX estimates that average unit net cash
costs, including molybdenum credits, for its North America copper mines
would approximate $1.24 per pound of copper for the year 2010. Unit net
cash costs for 2010 would change by approximately $0.02 per pound for
each $2 per pound change in the average price of molybdenum for the
second half of 2010.

Operating and Development Activities. At Morenci, FCX has
commenced a staged ramp up from the current mining rate of 450,000
metric tons of ore per day to 635,000 metric tons per day. In addition,
FCX restarted the Morenci mill in March 2010 to process available
sulfide material currently being mined. Mill throughput averaged 28,000
metric tons of ore per day during the second quarter of 2010 and is
expected to increase to approximately 50,000 metric tons per day by
2011. The increased mining and milling activities are expected to expose
additional ore and enable copper production to increase by approximately
125 million pounds annually beginning in 2011. Further increases to
Morenci′s mining rate are being evaluated.

FCX has initiated mining activities at the Miami mine in Arizona to
improve efficiencies of ongoing reclamation projects associated with
historical mining operations at the site. During an approximate
five-year mine life, FCX expects to ramp up production at Miami to
approximately 100 million pounds of copper per year by the second half
of 2011. FCX is investing $40 million in this project, which is
benefiting from the use of existing mining equipment.

FCX is advancing plans to construct a sulphur burner at Safford, which
will provide a more cost effective source of sulphuric acid used in
solution extraction/electrowinning operations and lower transportation
costs. This project is expected to be complete during 2011 at a capital
investment of approximately $150 million.

FCX is evaluating the restart of mining and milling activities at the
Chino mine in New Mexico, which were suspended in late 2008 in response
to global economic conditions. The preliminary economics of the project
appear attractive and would increase copper production by approximately
150 to 200 million pounds per year. At December 31, 2009, Chino′s
reserves, excluding metal in stockpiles, totaled 1.1 billion pounds of
copper (determined using a long-term average price of $1.60 per pound
for copper) and reserves would increase with higher prices.

Operating plans at the other North America sites are being assessed and
adjustments will be made based on market conditions.

South America Mining. FCX operates four copper mines in South
America ? Cerro Verde in Peru and Candelaria, Ojos del Salado and El
Abra in Chile. FCX owns a 53.56 percent interest in Cerro Verde, an
open-pit mine currently producing both electrowon copper cathodes and
copper concentrates. FCX owns 80 percent of the Candelaria and Ojos del
Salado mining complexes, which include the Candelaria open-pit and
underground mines and the Ojos del Salado underground mines. These mines
use common processing facilities to produce copper concentrates. FCX
owns a 51 percent interest in El Abra, an open-pit mine producing
electrowon copper cathodes. All operations in South America are
consolidated in FCX′s financial statements.

Consolidated copper sales in South America totaled 311 million pounds in
the second quarter of 2010, 14 percent lower than second-quarter 2009
sales, primarily reflecting lower ore grades at Candelaria and timing of
shipments at Cerro Verde.

For the year 2010, FCX expects South America sales of 1.3 billion pounds
of copper and 100 thousand ounces of gold, compared with 1.4 billion
pounds of copper and 90 thousand ounces of gold for 2009. Projected
sales volumes for 2010 are lower than 2009 primarily because of the
impacts of anticipated lower ore grades, principally at El Abra in
connection with the depletion of the oxide ore resource and the
transition to the sulfide deposit.

South America unit site production and delivery costs were higher in the
second quarter of 2010, compared with the second quarter of 2009,
primarily because of lower sales volumes. Partly offsetting these higher
unit costs were higher molybdenum credits and lower treatment charges.

Using current 2010 sales and costs estimates, FCX estimates that average
unit net cash costs, including molybdenum and gold credits, for its
South America mining operations would approximate $1.18 per pound of
copper for the year 2010.

Operating and Development Activities. FCX is engaged in
construction activities associated with the development of a large
sulfide deposit at El Abra to extend its mine life by over 10 years.
Production from the sulfide ore, which will ramp up to approximately 300
million pounds of copper per year, is expected to begin in 2012 and will
replace the currently depleting oxide copper production. The capital
investment for this project is expected to total $725 million through
2015, including $535 million for the initial phase of the project
expected to be completed in 2012. In addition, FCX has initiated studies
for a potential milling operation to process additional sulfide material
and to achieve higher recoveries.

FCX is completing a project to optimize throughput at the existing Cerro
Verde concentrator. The project, which is expected to be completed by
the end of 2010, is expected to increase mill throughput from 108,000
metric tons of ore per day to 120,000 metric tons per day resulting in
incremental annual production of approximately 30 million pounds of
copper. The capital investment for this project is expected to total
approximately $50 million.

In addition, FCX is evaluating a large scale concentrator expansion at
Cerro Verde. Reserve additions in recent years have provided
opportunities potentially to more than double the existing facility′s
capacity. A feasibility study is expected to be completed in the first
half of 2011.

Indonesia Mining. Through its 90.64 percent owned and wholly
consolidated subsidiary PT Freeport Indonesia (PT-FI), FCX operates the
world′s largest copper and gold mine in terms of reserves at its
Grasberg operations in Papua, Indonesia.

As expected, Indonesia reported lower copper and gold sales in the
second quarter of 2010, compared to the second quarter of 2009, as a
result of sequencing of mining in a lower ore-grade section of the
Grasberg open pit. At the Grasberg mine, the sequencing in mining areas
with varying ore grades causes fluctuations in the timing of ore
production resulting in fluctuations in quarterly and annual sales of
copper and gold.

PT-FI has revised its mine plans to incorporate precautionary remedial
activities and geotechnical considerations affecting a relatively
high-grade section of the Grasberg open pit previously scheduled to be
mined in 2010 and 2011. The impact of these mine plan changes results in
the deferral of approximately 130 million pounds of copper and 270,000
ounces of gold, net to PT-FI's interest, from the 2010 to 2014 period to
the 2015 to 2016 period. The revised plans, which are subject to ongoing
review and optimization, reflect timing differences and do not result in
significant changes to reserves or ultimate production from the open pit.

FCX expects Indonesia sales of 1.2 billion pounds of copper and 1.7
million ounces of gold for the year 2010, compared with 1.4 billion
pounds of copper and 2.5 million ounces of gold for 2009. Anticipated
changes in ore grades throughout the year are expected to result in
significant variability in quarterly volumes. Mine sequencing at
Grasberg is expected to result in higher copper and gold grades
beginning in the fourth quarter of 2010.

Indonesia unit site production and delivery costs were higher in the
second quarter of 2010, compared with the second quarter of 2009,
primarily because of anticipated lower copper volumes for the 2010
period. Unit site production and delivery costs will vary with
fluctuations in production volumes because of the primarily fixed nature
of PT-FI′s cost structure. Gold credits were lower in the second quarter
of 2010 because of lower gold volumes, which also resulted in higher
unit net cash costs in the second quarter of 2010.

Assuming an average gold price of $1,200 per ounce for the second half
of 2010 and using current 2010 sales and costs estimates, FCX expects
PT-FI′s average unit net cash costs, including gold and silver credits,
to approximate $0.14 per pound for the year 2010. Unit net cash costs
for 2010 would change by approximately $0.04 per pound for each $50 per
ounce change in the average price of gold for the second half of 2010.
Quarterly unit net cash costs will vary significantly with variations in
quarterly metal sales volumes.

Africa Mining. FCX holds an effective 57.75 percent interest in
the Tenke Fungurume copper and cobalt mining concessions in the Katanga
province of the Democratic Republic of Congo (DRC) and is the operator
of the project. Construction activities on the approximately $2 billion
initial project were completed in 2009. Production of copper cathode
commenced in March 2009 and achieved targeted rates in September 2009.
The cobalt plant and sulphuric acid plant were commissioned in the third
quarter of 2009. Tenke Fungurume continues to address start-up and
quality issues in the cobalt circuit and expects to implement corrective
actions over the next several quarters. Based on the 10-year average of
current design operations, Tenke Fungurume expects to produce 250
million pounds of copper and 18 million pounds of cobalt per year.
Higher grades of cobalt in the initial years are expected to result in
higher than life-of-mine average annual cobalt production volumes.

FCX expects Tenke Fungurume sales of approximately 250 million pounds of
copper and 20 million pounds of cobalt for the year 2010, compared with
130 million pounds of copper and 3 million pounds of cobalt for 2009.

During the second quarter of 2010, Tenke Fungurume′s unit site
production and delivery costs averaged $1.27 per pound of copper and its
unit net cash costs, net of cobalt by-product credits, averaged $0.79
per pound of copper.

FCX has recently updated its cost forecast for Tenke Fungurume to
incorporate revised modeling for estimated sulphuric acid consumption,
increased input costs and actual cost history, and increased government
fees and administrative costs associated with the complex nature of the
operating environment in the DRC. Assuming an average cobalt price of
$12 per pound for the second half of 2010 and the year 2011, average
unit net cash costs are expected to approximate $0.93 per pound of
copper for the year 2010 and $0.80 per pound of copper for the year
2011. Each $2 per pound change in the average price of cobalt would
impact unit net cash costs by approximately $0.10 per pound of copper.

Operating and Development Activities. FCX continues to engage in
drilling activities, exploration analyses and metallurgical testing to
evaluate the potential of the highly prospective district at Tenke
Fungurume and expects its ore reserves to increase significantly over
time. These analyses are being incorporated in future plans to evaluate
opportunities for expansion. FCX is completing studies to evaluate a
second phase of the project, which would include optimizing the current
plant and increasing capacity. A range of expansion options are being
considered.

The milling facilities, which were designed to produce at a capacity
rate of 8,000 metric tons of ore per day, have been performing above
capacity in recent months. Tenke Fungurume is procuring additional
mining equipment, which will enable additional high-grade material to be
mined and processed. Based on these enhancements to the mine plan and an
expected mill throughput rate of 10,000 metric tons of ore per day, FCX
estimates copper production will increase from the current level of 250
million pounds per annum to a rate approximating 290 million pounds per
annum during 2011.

Other Matters. FCX is continuing to work with the DRC government
to resolve the ongoing contract review and a number of administrative
disputes. FCX believes its contract is fair and equitable, complies with
Congolese law and is enforceable without modification.

Molybdenum. FCX is the world′s largest producer of molybdenum.
FCX conducts molybdenum mining operations at its wholly owned Henderson
underground mine in Colorado and sells by-product molybdenum from its
North and South America copper mines.

Consolidated molybdenum sales from the Henderson mine and by-product
mines totaled 16 million pounds in each of the second quarter periods.
Molybdenum markets were significantly affected beginning in the fourth
quarter of 2008 by the downturn in global economic conditions, resulting
in FCX′s operating its Henderson mine at reduced rates throughout 2009.
Improved market conditions have resulted in an increase in Henderson
rates to approximately 90 percent capacity.

For the year 2010, FCX expects molybdenum sales from its mines to
approximate 63 million pounds (includes by-product production of
approximately 30 million pounds from the North and South America copper
mines), compared with 58 million pounds in 2009 (includes by-product
production of 27 million pounds from the North and South America copper
mines). The weekly average Metals Week Molybdenum Dealer Oxide
price as of July 20, 2010, was $13.88 per pound.

Unit net cash costs at the Henderson primary molybdenum mine were lower
in the second quarter of 2010, compared with the second quarter of 2009,
primarily because of higher volumes. Using current 2010 sales estimates,
FCX expects average unit net cash costs for its Henderson mine to
approximate $6.25 per pound of molybdenum for the year 2010.

Operating and Development Activities. FCX is monitoring market
conditions to determine the timing for restarting construction of the
Climax molybdenum project, which was suspended in the fourth quarter of
2008. FCX believes that this project is one of the most attractive
primary molybdenum development projects in the world, with large scale
production capacity, attractive cash costs and future growth options.
The Climax mine would have an initial annual design capacity of 30
million pounds with significant expansion options. FCX has continued to
advance the project to prepare for resumption of construction activities
as market conditions improve. As of June 30, 2010, the estimated
remaining costs for the project approximate $500 million. FCX is
investing $60 million to advance certain construction activities during
the next several months to provide flexibility in start-up timing
options.

EXPLORATION ACTIVITIES

FCX is conducting exploration activities near its existing mines with a
focus on opportunities to expand reserves that will support the
development of additional future production capacity in the large
mineral districts where it currently operates. Significantly expanded
drilling activities in recent years have been successful in generating
meaningful reserve additions and in identifying potential additional
mineral resources adjacent to existing ore bodies. Results indicate
opportunities for significant future potential reserve additions at
Morenci, Sierrita and Bagdad in North America; Cerro Verde and El Abra
in South America and in the Tenke Fungurume district.

Exploration spending in 2010 is estimated to approximate $120 million,
compared with $72 million in 2009. Exploration activities will continue
to focus primarily on the potential in FCX′s existing mineral districts.

PROVISIONAL PRICING AND OTHER

For the first six months of 2010, approximately 47 percent of FCX′s
mined copper was sold in concentrate, 27 percent as cathode and 26
percent as rod from North America operations. Under the long-established
structure of sales agreements prevalent in the industry, substantially
all of FCX′s concentrate and cathode sales are provisionally priced at
the time of shipment. The provisional prices are finalized in a
contractually specified future period generally one to four months from
the shipment date, primarily based on quoted London Metal Exchange (LME)
prices. Because a significant portion of FCX′s concentrate and cathode
sales in any quarterly period usually remain subject to final pricing,
the quarter-end forward price is a major determinant of recorded
revenues and the average recorded copper price for the period.

At March 31, 2010, 372 million pounds of copper sales at FCX′s copper
mining operations (net of intercompany sales and noncontrolling
interests) were provisionally priced at an average of $3.53 per pound.
Unfavorable adjustments to the March 31, 2010, provisionally priced
copper sales decreased second-quarter 2010 consolidated revenues by $169
million ($72 million to net income attributable to common stock or $0.15
per share), and favorable adjustments to the March 31, 2009,
provisionally priced copper sales increased second-quarter 2009
consolidated revenues by $43 million ($13 million to net income
attributable to common stock or $0.03 per share). Unfavorable
adjustments to the December 31, 2009, provisionally priced copper sales
decreased consolidated revenues in the first six months of 2010 by $23
million ($9 million to net income attributable to common stock or $0.02
per share), and favorable adjustments to the December 31, 2008,
provisionally priced copper sales increased consolidated revenues in the
first six months of 2009 by $132 million ($62 million to net income
attributable to common stock or $0.15 per share).

LME copper prices averaged $3.18 per pound during the second quarter of
2010, compared with FCX′s recorded average price of $3.06 per pound. At
June 30, 2010, FCX had copper sales of 364 million pounds of copper at
its copper mining operations (net of intercompany sales and
noncontrolling interests) priced at an average of $2.95 per pound,
subject to final pricing over the next several months. Each $0.05 change
from the June 30, 2010, average price for provisionally priced copper
sales would have an approximate $12 million effect on FCX′s 2010 net
income attributable to common stock. The LME closing settlement price
for copper on July 20, 2010, was $2.96 per pound.

FCX defers recognizing profits on its PT-FI and South America sales to
Atlantic Copper and on 25 percent of PT-FI′s sales to PT Smelting,
PT-FI′s 25 percent-owned Indonesian smelting unit, until final sales to
third parties occur. FCX′s net deferred profits on PT-FI and South
America concentrate inventories at Atlantic Copper and PT Smelting to be
recognized in future periods′ net income attributable to common stock
totaled $137 million at December 31, 2009, $157 million at March 31,
2010, and $93 million at June 30, 2010. Changes in FCX′s net deferrals
attributable to variability in intercompany volumes resulted in
additions to net income attributable to common stock totaling $20
million, $0.04 per share, in the second quarter of 2010 and reductions
of $28 million, $0.06 per share, in the first six months of 2010. For
the 2009 periods, changes in FCX′s net deferrals attributable to
variability in intercompany volumes resulted in additions to net income
attributable to common stock totaling $13 million, $0.03 per share, for
the second quarter and reductions of $3 million, $0.01 per share, for
the first six months of 2009. Quarterly variations in ore grades, the
timing of intercompany shipments and changes in product prices will
result in variability in FCX′s net deferred profits and quarterly
earnings.

CASH FLOWS, CASH, DEBT and EQUITY

Operating cash flows totaled $1.1 billion for the second quarter of
2010, net of $173 million of working capital requirements, and $2.9
billion for the first six months of 2010, including $107 million from
working capital sources. Capital expenditures totaled $296 million for
the second quarter of 2010 and $527 million for the first six months of
2010.

At June 30, 2010, FCX had consolidated cash of $3.0 billion. Net of
noncontrolling interests′ share, taxes and other costs, cash available
to parent company totaled $2.2 billion as shown below (in billions):

At June 30, 2010, FCX had $4.8 billion in debt. FCX had no borrowings
and $42 million of letters of credit issued under its revolving credit
facilities, resulting in total availability of approximately $1.5
billion at June 30, 2010.

During the second quarter of 2010, FCX reduced debt by $1.3 billion,
including the April 1^st redemption of $1.0 billion of
outstanding Senior Floating Rate Notes due 2015 and repayment of $278
million of its senior debt through open-market purchases at a cost of
$302 million. From January 1, 2009, through June 30, 2010, FCX has
repaid approximately $2.6 billion in debt (approximately 35 percent of
outstanding debt on January 1, 2009), resulting in estimated annual
interest savings of approximately $172 million.

FCX′s debt maturities through 2012 are indicated in the table below (in
millions).

At June 30, 2010, FCX had 470 million common shares outstanding. In the
second quarter of 2010, FCX′s 6 ¾% Mandatory Convertible Preferred Stock
converted into 39 million shares of FCX common stock (conversion rate
equal to 1.3716 shares of FCX common stock).

OUTLOOK

Projected sales volumes for 2010 approximate 3.8 billion pounds of
copper, 1.8 million ounces of gold and 63 million pounds of molybdenum,
including 970 million pounds of copper, 410 thousand ounces of gold and
15 million pounds of molybdenum in the third quarter of 2010. Mining
sequencing at Grasberg is resulting in significant fluctuations in
quarterly sales of copper and gold during 2010.

Using current 2010 sales estimates and assuming average prices of $3.00
per pound of copper, $1,200 per ounce of gold and $14 per pound of
molybdenum for the second half of 2010, FCX′s consolidated operating
cash flows are estimated to exceed $5 billion in 2010. The impact of
price changes in the second half of 2010 on FCX′s 2010 operating cash
flows would approximate $150 million for each $0.10 per pound change for
copper, $30 million for each $50 per ounce change for gold and $25
million for each $2 per pound change for molybdenum.

FCX′s capital expenditures are currently estimated to approximate $1.7
billion for 2010. Capital expenditures for major projects in 2010 are
expected to approximate $0.8 billion, which primarily includes
underground development activities at Grasberg, the sulfide ore project
at El Abra and investments in a new sulphur burner facility at Safford.
Capital spending plans will continue to be reviewed and adjusted in
response to changes in market conditions and other factors.

FINANCIAL POLICY

FCX has a long-standing tradition of seeking to build shareholder value
through pursuing development projects with high rates of return and
returning cash to shareholders through common stock dividends and share
purchases.

In April 2010, FCX′s Board of Directors authorized an increase in the
cash dividend on common stock from an annual rate of $0.60 per share to
$1.20 per share ($0.30 per share quarterly). The first quarterly
dividend of $0.30 per share was declared on June 24, 2010, and is
payable on August 1, 2010.

There are 23.7 million shares remaining under FCX′s 30 million share
open-market share purchase program. The Board will continue to review
FCX′s financial policy on an ongoing basis.

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FCX is a leading international mining company with headquarters in
Phoenix, Arizona. FCX operates large, long-lived, geographically diverse
assets with significant proven and probable reserves of copper, gold and
molybdenum. FCX has a dynamic portfolio of operating, expansion and
growth projects in the copper industry and is the world′s largest
producer of molybdenum.

The company′s portfolio of assets includes the Grasberg mining complex,
the world′s largest copper and gold mine in terms of recoverable
reserves, significant mining operations in the Americas, including the
large scale Morenci and Safford minerals districts in North America and
the Cerro Verde and El Abra operations in South America, and the Tenke
Fungurume minerals district in the DRC. Additional information about FCX
is available on FCX′s web site at 'www.fcx.com.?

Cautionary Statement and Regulation G Disclosure:This
press release contains forward-looking statements in which FCX discusses
its performance in the future.Forward-looking statements are all
statements other than statements of historical facts, such as those
statements regarding projected ore grades and milling rates, projected
production and sales volumes, projected unit net cash costs, projected
operating cash flows, projected capital expenditures, the impact of
copper, gold, molybdenum and cobalt price changes, reserve estimates,
potential prepayments of debt, future dividend payments and potential
share purchases.The words 'anticipates,? 'may,? 'can,? 'plans,?
'believes,? 'estimates,? 'expects,? 'projects,? 'intends,? 'likely,?
'will,? 'should,? 'to be,? and any similar expressions and/or statements
that are not historical facts, in each case as they relate to FCX or its
management, are intended to identify those assertions as forward-looking
statements.The declaration and payment of dividends is at the
discretion of FCX′s Board of Directors and will depend on FCX′s
financial results, cash requirements, future prospects, and other
factors deemed relevant by the Board.This press release also
includes forward-looking statements regarding mineralized material not
included in reserves.The mineralized material described in this
press release will not qualify as reserves until comprehensive
engineering studies establish their economic feasibility.Accordingly,
no assurance can be given that the estimated mineralized material not
included in reserves will become proven and probable reserves.

In making any forward-looking statements, the person making them
believes that the expectations are based on reasonable assumptions.FCX
cautions readers that those statements are not guarantees of future
performance and its actual results may differ materially from those
anticipated, projected or assumed in the forward-looking statements.Important
factors that can cause FCX′s actual results to differ materially from
those anticipated in the forward-looking statements include commodity
prices, mine sequencing, production rates, industry risks, regulatory
changes, political risks, the potential effects of violence in
Indonesia, potential outcomes of the contract review process and
resolution of administrative disputes in the Democratic Republic of
Congo, weather-related risks, labor relations, environmental risks,
litigation results, currency translation risks and other factors
described in more detail under the heading 'Risk Factors? in FCX's
Annual Report on Form 10-K for the year ended December 31, 2009, filed
with the Securities and Exchange Commission (SEC).Accordingly,
no assurances can be given that any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of them do
so, what impact they will have on FCX′s results of operations or
financial condition.FCX cautions readers that it assumes no
obligation to update the forward-looking statements in this press
release and does not intend to update the forward-looking statements
more frequently than quarterly.

This press release also contains certain financial measures such as
unit net cash costs per pound of copper and per pound of molybdenum.As
required by SEC Regulation G, reconciliations of these measures to
amounts reported in FCX′s consolidated financial statements are in the
supplemental schedule, 'Product Revenues and Production Costs,?
beginning on page VII, which is available on FCX′s web site, 'www.fcx.com.?

A copy of this release is available on FCX′s web site, 'www.fcx.com.?A conference call with securities analysts about second-quarter 2010
results is scheduled for today at 10:00 a.m. Eastern Time.The
conference call will be broadcast on the Internet along with slides.Interested
parties may listen to the conference call live and view the slides by
accessing 'www.fcx.com.?
A replay of the webcast will be available through Friday, August 20,
2010.