Freeport-McMoRan 2011 Annual Report Download - page 15

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South America
FCX operates four copper mines in South America — Cerro Verde in Peru, and El Abra,
Candelaria and Ojos del Salado in Chile. In addition to copper, the Cerro Verde mine also produces
molybdenum concentrates, and the Candelaria and Ojos del Salado mines also produce gold.
During 2011, FCX commenced production from El Abra’s newly commissioned stacking and
leaching facilities to transition from production of oxide to sulde ores. Production from the
sulde ore approximates 300 million pounds of copper per year, replacing the depleting oxide
copper production. FCX is also engaged in pre-feasibility studies for a potential large-scale milling
operation at El Abra to process additional sulde material and to achieve higher recoveries.
FCX continues to advance plans for a large-scale concentrator expansion at Cerro Verde. e project
would expand the concentrator facilities from the current rate of 120,000 metric tons of ore per day
to 360,000 metric tons of ore per day and provide incremental annual production of approximately
600 million pounds of copper and 15 million pounds of molybdenum beginning in 2016.
South America’s consolidated copper sales totaled 1.3 billion pounds at an average realized price of
$3.77 per pound in 2011, compared to 1.3 billion pounds at an average realized price of $3.68 per
pound in 2010. South America’s consolidated gold sales totaled 101,000 ounces in 2011, compared
to 93,000 ounces in 2010. FCX expects 2012 sales from South America to approximate 1.3 billion
pounds of copper and 100,000 ounces of gold.
Medical science is making
exciting new discoveries
about the germ-killing,
anti-microbial properties
of copper. Extensive research,
including clinical trials
in hospitals, is proving that
copper surfaces are capable
of killing harmful, potentially
deadly bacteria.
2011
Cash Unit Costs
Site Production & Delivery (1) $ 1.38
By-product Credits (0.35)
Treatment Charges 0.17
Unit Net Cash Costs $ 1.20
(1) Production costs include profit sharing.
South America Unit Cash Costs
per lb of copper
OPERATIONAL OVERVIEW
South America
Copper Sales
in billion lbs
2012e 2011
0.75
1.50
1.25
1.00
0.50
0.25
South America Copper
Reserves by Mine
39.1 billion
consolidated lbs
77% Cerro Verde
12 % Candelaria and
Ojos del Salado
11% El Abra
Connection Point
Note: e=estimate.
2011 ANNUAL REPORT | 13