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Freeport-McMoRan Copper & Gold Inc. Reports Third-Quarter And Nine-Month 2012 Results

FCX expects Africa's sales to approximate 330 million pounds of copper and 25 million pounds of cobalt for the year 2012, compared with 283 million pounds of copper and 25 million pounds of cobalt for the year 2011.

Africa's unit net cash costs (net of cobalt credits) of $1.23 per pound of copper in third-quarter 2012 were higher than unit net cash costs of $1.12 per pound in third-quarter 2011, primarily reflecting higher mining and input costs, including sulphuric acid and energy.

FCX estimates Africa's average unit net cash costs would approximate $1.25 per pound of copper for the year 2012, based on current sales volume and cost estimates and assuming an average cobalt price of $12 per pound for fourth-quarter 2012. Africa's unit net cash costs for 2012 would change by approximately $0.025 per pound for each $2 per pound change in the average price of cobalt for fourth-quarter 2012.

Molybdenum. FCX is the world's largest producer of molybdenum. FCX conducts molybdenum mining operations at its wholly owned Henderson underground mine and Climax open-pit mine in Colorado, and also sells molybdenum produced from its North and South America copper mines.

Operating and Development Activities. The newly commissioned Climax molybdenum mine, which includes a new 25,000 metric ton per day mill facility, began commercial production in May 2012. Depending on market conditions, production from Climax may ramp up to a rate of 20 million pounds of molybdenum per year during 2013, with potential to produce 30 million pounds of molybdenum per year. FCX intends to operate the Climax and Henderson mines in a flexible manner to meet market requirements. FCX believes that Climax is one of the most attractive primary molybdenum mines in the world, with large-scale production capacity, attractive cash costs and future growth options.

Operating Data. Following is summary consolidated operating data for the Molybdenum operations for the third quarters and first nine months of 2012 and 2011:
  Three Months Ended     Nine Months Ended
September 30, September 30,
  2012   2011 2012   2011
Molybdenum (millions of recoverable pounds)
Production 10 a 11 28 a 30
Sales, excluding purchases b 21 19 62 60
Average realized price per pound $ 13.62 $ 16.34 $ 14.79 $ 17.57

Henderson's unit net cash cost per pound of molybdenum c
$ 7.11 $ 6.24 $ 6.94 $ 6.19

a. Molybdenum production from the Climax mine totaled 1 million pounds in third-quarter 2012 and 2 million pounds for the first nine months of 2012, reflecting production since the start of commercial operations in May 2012 (the 2011 periods reflect only production from the Henderson molybdenum mine).

b. Includes sales of molybdenum produced at the North and South America copper mines.

c. Reflects unit net cash costs for the Henderson molybdenum mine, excluding net noncash and other costs. For a reconciliation of unit net cash costs per pound to production and delivery costs applicable to sales reported in FCX's consolidated financial statements, refer to the supplemental schedule, "Product Revenues and Production Costs," beginning on page VII, which is available on FCX's website, " ."

Consolidated molybdenum sales of 21 million pounds in third-quarter 2012 were higher than third-quarter 2011 sales of 19 million pounds. For the year 2012, FCX expects molybdenum sales to approximate 82 million pounds (including production of approximately 43 million pounds from the North and South America copper mines), compared with 79 million pounds in 2011 (including production of 45 million pounds from the North and South America copper mines).

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