Freeport-McMoRan 2009 Annual Report Download - page 74

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
72 -9,,769;4J4V9HU*677,9.63+05*
  (UU\HS9LWVY[
RSHUDWLRQVEHJLQQLQJ'HFHPEHU37 )UHHSRUW,QGRQHVLDDJUHHG
WKDWWKHFRPELQHGWUHDWPHQWDQGUHÀQLQJFKDUJHVIHHVSDLGWR
VPHOWHUVE\PLQHUVZRXOGDSSUR[LPDWHPDUNHWUDWHVEXWZLOOQRWIDOO
EHORZVSHFLÀHGPLQLPXPUDWHV7KHPLQLPXPUDWHDSSOLFDEOHWRWKH
SHULRG$SULO WR$SULO LVWREHGHWHUPLQHGDQQXDOO\
DQGEHVXIÀFLHQWWRFRYHU376PHOWLQJҋVDQQXDOFDVKRSHUDWLQJFRVWV
QHWRIFUHGLWVDQGLQFOXGLQJFRVWVRIGHEWVHUYLFHIRU
PHWULFWRQVRI FRSSHU7KHPD[LPXPUDWHLVSHUSRXQG7KH
DJUHHPHQWLVDQDPHQGPHQWWRWKHORQJWHUPVDOHVFRQWUDFWZKLFK
ZDVDSSURYHGE\WKH'HSDUWPHQWRI(QHUJ\DQG0LQHUDO5HVRXUFHV
RIWKH*RYHUQPHQWRI,QGRQHVLD37 )UHHSRUW,QGRQHVLDDOVRVHOOV
FRSSHUFRQFHQWUDWHWR376PHOWLQJDWPDUNHWUDWHVZKLFKDUH
QRWVXEMHFWWRDPLQLPXPRUPD[LPXPUDWHIRUTXDQWLWLHVLQH[FHVV
RIPHWULFWRQVRIFRSSHUDQQXDOO\
)&;ҋVLQYHVWPHQWLQ376PHOWLQJWRWDOHGPLOOLRQDW
'HFHPEHUDQGPLOOLRQDW'HFHPEHU
376PHOWLQJKDGSURMHFWVSHFLÀFGHEWQRQUHFRXUVHWR37)UHHSRUW
,QGRQHVLDWRWDOLQJPLOOLRQDW'HFHPEHUDQG
PLOOLRQDW 'HFHPEHU37 )UHHSRUW,QGRQHVLDKDGD
WUDGHUHFHLYDEOHIURP376PHOWLQJWRWDOLQJPLOOLRQDW
'HFHPEHUDQGPLOOLRQDW'HFHPEHU
NOTE 4. Inventories, and Mill and Leach Stockpiles
7KHFRPSRQHQWVRILQYHQWRULHVIROORZ
+LJLTILY    2009 
0LQLQJ2SHUDWLRQV
5DZPDWHULDOV   $ 1  
 :RUNLQSURFHVV    108  
 )LQLVKHGJRRGVD   588  
$WODQWLF&RSSHU
5DZPDWHULDOVFRQFHQWUDWHV    171  
 :RUNLQSURFHVV    227  
 )LQLVKHGJRRGV    15  
7RWDOSURGXFWLQYHQWRULHV   1,110 
7RWDOPDWHULDOVDQGVXSSOLHVQHWE  1,093 
  7RWDOLQYHQWRULHV  $2,203 
H 7YPTHYPS`PUJS\KLZJVWWLYJVUJLU[YH[LZHUVKLZJH[OVKLZHUKYVKHUKTVS`IKLU\T
I 4H[LYPHSZHUKZ\WWSPLZPU]LU[VY`PZUL[VMVIZVSLZJLUJLYLZLY]LZ[V[HSPUNTPSSPVUH[
+LJLTILY HUKTPSSPVUH[+LJLTILY
$VXPPDU\RIPLOODQGOHDFKVWRFNSLOHVIROORZV

  5VY[O :V\[O
December 31, 2009  (TLYPJH(TLYPJH0UKVULZPH(MYPJH ;V[HS
&XUUHQW
0LOOVWRFNSLOHV $ — $ 7 $39 $ — $ 46
 /HDFKVWRFNSLOHV 547 74 — — 621
  7RWDOFXUUHQWPLOODQGOHDFK
   VWRFNSLOHV $547 $81 $39 $ — $ 667
/RQJWHUPD
0LOOVWRFNSLOHV $15 $427 $ — $ — $ 442
 /HDFKVWRFNSLOHV 637 220 —22 879
  7RWDOORQJWHUPPLOODQG
   OHDFKVWRFNSLOHV $652 $647 $ — $ 22 $1,321
H[SDQVLRQFRPSOHWHGLQWRLLWRWDOUHYHQXHVIURPSURGXFWLRQ
IURP%ORFN$LQFOXGLQJSURGXFWLRQIURP37 )UHHSRUW,QGRQHVLDҋV
SUHYLRXVO\H[LVWLQJUHVHUYHV37 )UHHSRUW,QGRQHVLDZLOOFRQWLQXHWR
UHFHLYHSHUFHQWRIWKHFDVKÁRZIURPVSHFLÀHGDQQXDODPRXQWV
RIFRSSHUJROGDQGVLOYHUWKURXJKFDOFXODWHGE\UHIHUHQFHWRLWV
SURYHQDQGSUREDEOHUHVHUYHVDVRI'HFHPEHUDQG
SHUFHQWRIDOOUHPDLQLQJFDVKÁRZ7KHSD\DEOHWR5LR7LQWRIRULWV
VKDUHRIMRLQWYHQWXUHFDVKÁRZVZDVPLOOLRQDW'HFHPEHU
DQGOHVVWKDQPLOOLRQDW'HFHPEHU
8QGHUWKHMRLQWYHQWXUHDUUDQJHPHQWV5LR7LQWRIXQGHG
PLOOLRQLQIRUDSSURYHGH[SORUDWLRQFRVWVLQWKHDUHDVFRYHUHGE\
&RQWUDFWVRI:RUNKHOGE\)&;VXEVLGLDULHV$JUHHGXSRQH[SORUDWLRQ
FRVWVLQWKHMRLQWYHQWXUHDUHDVDUHVKDUHGSHUFHQWE\)&;DQG
SHUFHQWE\5LR7LQWR6LQFH6HSWHPEHU5LR7LQWRLVQRORQJHU
SDUWLFLSDWLQJLQH[SORUDWLRQMRLQWYHQWXUHVLQWKH37 1DELUH%DNWL
0LQLQJDQG37 ,UMD(DVWHUQ0LQHUDOV&RQWUDFWRI:RUNDUHDVLQ
,QGRQHVLD$VDUHVXOWDVORQJDV5LR7LQWRFRQWLQXHVQRWWRIXQG
WKHVHH[SORUDWLRQSURMHFWV)&;KDVWKHRSWLRQWRIXQGSHUFHQWRI
IXWXUHH[SORUDWLRQFRVWVLQWKHVHDUHDVDQG5LR7LQWRҋVLQWHUHVWLQ
WKHVHDUHDVZLOOGHFOLQHRYHUWLPHLQDFFRUGDQFHZLWKWKHMRLQWYHQWXUH
DJUHHPHQW5LR7LQWRKDVWKHRSWLRQWRUHVXPHSDUWLFLSDWLRQLQ37 ,UMD
(DVWHUQ0LQHUDOVRQDPRQWKO\EDVLVDQGLQ37 1DELUH%DNWL0LQLQJ
RQDQDQQXDOEDVLV5LR7LQWRFRQWLQXHVWRSDUWLFLSDWHLQH[SORUDWLRQ
MRLQWYHQWXUHVLQ37 )UHHSRUW,QGRQHVLDҋV&RQWUDFWRI:RUNDUHDV
Sumitomo. )&;RZQVDQSHUFHQWXQGLYLGHGLQWHUHVWLQ0RUHQFL
YLDDQXQLQFRUSRUDWHGMRLQWYHQWXUH7KHUHPDLQLQJSHUFHQWLV
RZQHGE\6XPLWRPRDMRLQWO\RZQHGVXEVLGLDU\RI6XPLWRPR0HWDO
0LQLQJ&R/WG DQG6XPLWRPR&RUSRUDWLRQ(DFKSDUWQHUWDNHVLQ
NLQGLWVVKDUHRI0RUHQFLҋVSURGXFWLRQ)0&SXUFKDVHGPLOOLRQ
SRXQGVRI0RUHQFLҋVFRSSHUFDWKRGHIURP6XPLWRPRIRUPLOOLRQ
GXULQJPLOOLRQSRXQGVIRUPLOOLRQGXULQJDQG
PLOOLRQSRXQGVIRUPLOOLRQGXULQJWKHSHULRG0DUFK
WR'HFHPEHU)&;KDGDQHWUHFHLYDEOHIURP
6XPLWRPRRIPLOOLRQDW'HFHPEHUDQGPLOOLRQDW
'HFHPEHU
Investment in PT Smelting. 37 6PHOWLQJDQ,QGRQHVLDQFRPSDQ\
RSHUDWHVDVPHOWHUDQGUHÀQHU\LQ*UHVLN,QGRQHVLD'XULQJ
37 6PHOWLQJFRPSOHWHGDQH[SDQVLRQRILWVSURGXFWLRQFDSDFLW\WR
PHWULFWRQVRIFRSSHUSHU\HDUIURPPHWULFWRQV
37)UHHSRUW,QGRQHVLD0LWVXELVKL0DWHULDOV&RUSRUDWLRQ0LWVXELVKL
0DWHULDOV0LWVXELVKL&RUSRUDWLRQ0LWVXELVKLDQG1LSSRQ0LQLQJ
0HWDOV&R/WG1LSSRQRZQSHUFHQWSHUFHQWSHUFHQW
DQGSHUFHQWUHVSHFWLYHO\RIWKHRXWVWDQGLQJ376PHOWLQJ
FRPPRQVWRFN
37 )UHHSRUW,QGRQHVLDҋVFRQWUDFWZLWK37 6PHOWLQJSURYLGHVIRUWKH
VXSSO\RISHUFHQWRIWKHFRSSHUFRQFHQWUDWHUHTXLUHPHQWV
QHFHVVDU\IRU37 6PHOWLQJWRSURGXFHPHWULFWRQVRIFRSSHU
DQQXDOO\HVVHQWLDOO\WKHVPHOWHUҋVRULJLQDOGHVLJQFDSDFLW\RQD
SULRULW\EDVLV)RUWKHÀUVW\HDUVRI376PHOWLQJҋVFRPPHUFLDO