Africa Mining. Through its 56 percent owned and wholly consolidated subsidiary Tenke Fungurume Mining S.A.R.L (TFM), FCX operates the Tenke Fungurume (Tenke) mine in the Katanga province of the Democratic Republic of Congo (DRC). In addition to copper, the Tenke mine produces cobalt hydroxide.
Operating and Development Activities. FCX is nearing completion of a second phase of the project, which includes optimizing the current plant and increasing capacity. FCX is expanding the mill rate to 14,000 metric tons of ore per day and is completing construction of the related processing facilities that target the addition of approximately 150 million pounds of copper per year in 2013. The approximate $850 million project includes mill upgrades, additional mining equipment, a new tankhouse and a sulphuric acid plant expansion. Construction activities are progressing well and are expected to be substantially complete by year-end 2012. The addition of a second sulphuric acid plant is expected to be completed in 2015.
During third-quarter 2012, Tenke achieved record mining, milling and copper production rates. Improved performance and the second phase expansion are expected to enable copper production to exceed 400 million pounds for the year 2013, compared with initial design capacity of 250 million pounds per year.
FCX continues to engage in drilling activities, exploration analyses and metallurgical testing to evaluate the potential of the highly prospective minerals district at Tenke. These analyses are being incorporated in future plans to evaluate opportunities for expansion. Future expansions are subject to a number of factors, including economic and market conditions, and the business and investment climate in the DRC.Operating Data. Following is summary consolidated operating data for the Africa mining operations for the third quarters and first nine months of 2012 and 2011:
|Three Months Ended||Nine Months Ended|
|September 30,||September 30,|
|Copper (millions of recoverable pounds)|
|Average realized price per pound a||$||3.55||$||3.46||$||3.54||$||3.89|
|Cobalt (millions of contained pounds)|
|Average realized price per pound||$||8.24||$||10.05||$||8.36||$||10.71|
|Unit net cash costs per pound of copper:|
|Site production and delivery, excluding adjustments||$||1.63||$||1.55||$||1.54||$||1.57|
|Cobalt credits b||(0.48||)||(0.51||)||(0.39||)||(0.68||)|
|Royalty on metals||0.08||0.08||0.08||0.09|
|Unit net cash costs c||$||1.23||$||1.12||$||1.23||$||0.98|