Freeport-McMoRan 2003 Annual Report Download - page 69

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2003 Annual Report FREEPORT-McMoRan COPPER & GOLD INC. 67
PT Freeport
FCX Indonesia Atlantic Copper
2003 2002 2003 2002 2003 2002
Debt securities 97
%
97%
5%
6%
100
%
100
%
Cash and bank deposits 33
95
94
——
Total
100%
100%
100%
100%
100%
100%
The components of net periodic benefit cost for
FCX’s and, since October 1, 2002, FM Services
Company’s pension plans follow (in thousands):
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2003 2002 2001
Interest cost
$1,085
$887 $ 756
Expected return on plan assets
(751)
(639) (279)
Net periodic benefit cost
$334
$248 $ 477
The pension plan weighted-average asset allocation for
the FCX (including FM Services Company), PT Freeport
Indonesia and Atlantic Copper plans at December 31,
2003 and 2002 follow:
The components of net periodic benefit cost for PT
Freeport Indonesia’s and Atlantic Copper’s pension
plans follow (in thousands):
PT Freeport Indonesia Atlantic Copper
2003 2002 2001 2003 2002 2001
Service cost
$3,148
$2,041 $1,072
$—
$— $—
Interest cost
3,366
2,166 1,237
4,821
4,266 4,152
Expected return on plan assets
(1,888)
(1,217) (887)
—
— —
Amortization of prior service cost
894
514 237
—
——
Amortization of net actuarial loss
478
242 63
1,316
785 780
Net periodic benefit cost
$5,998
$3,746 $1,722
$6,137
$5,051 $4,932
The FCX and FM Services Company pension plans
were terminated in 2000 as discussed above.
Therefore, the entire asset balance of $24.1 million
at December 31, 2003, and any unfunded benefits will
be paid upon liquidation of the plans after Internal
Revenue Service and Pension Benefit Guaranty
Corporation approval. The rupiah benefit payments
that are expected to be paid for PT Freeport
Indonesia's pension plan total 32.2 billion in 2004,
33.8 billion in 2005, 39.0 billion in 2006, 44.7 billion
in 2007, 51.8 billion in 2008 and 266.4 billion for
2009 through 2013. Atlantic Copper's plan is adminis-
tered by a third-party insurance company and Atlantic
Copper is not provided benefit payment projections.
Other Benefits. FCX and FM Services Company
also provide certain health care and life insurance
benefits for retired employees. FCX and FM Services
Company have the right to modify or terminate these
benefits. The initial health care cost trend rate used
for the other benefits was 11 percent for 2004,
decreasing ratably each year until reaching 5 percent
in 2009. A one-percentage-point increase or
decrease in assumed health care cost trend rates
would not have a significant impact on total service or
interest cost. Information on the employee health
care and life insurance benefits FCX and, since
October 1, 2002, FM Services Company provide
follows (in thousands):