Fair Value Measurement (Unaudited) (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

A summary of the changes in the fair value of FCX's Level 3 derivative financial instruments for the six months ended June 30, 2013, follows (in millions):



	Crude Oil			Plains Offshore
	Options			Warrants
Fair value at December 31, 2012	$	—		$	—
Derivative financial instruments assumed in the PXP acquisition	(83		)	(79		)
Net unrealized losses included in earnings related to
assets and liabilities still held at the end of the period^a	(33		)	—
Fair value at June 30, 2013	$	(116	)	$	(79	)


a.	Realized and unrealized (losses) gains are recorded in revenue. There were no realized gains for the six months ended June 30, 2013.

Carrying Amount and Fair Value of Other Financial Instruments

A summary of the carrying amount and fair value of FCX’s financial instruments other than cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, and dividends payable follows (in millions):



	At June 30, 2013
	Carrying		Fair Value
	Amount		Total		Level 1		Level 2		Level 3
Assets
Investment securities (current and long-term):^{a, b, c}
Money market funds	$	80	$	80	$	80	$	—	$	—
U.S. core fixed income fund	21		21		—		21		—
Equity securities	6		6		6		—		—
Total investment securities	107		107		86		21		—

Trust assets (long-term):^{a, c}
U.S. core fixed income fund	48		48		—		48		—
Government mortgage-backed securities	37		37		—		37		—
Corporate bonds	26		26		—		26		—
Government bonds and notes	21		21		—		21		—
Asset-backed securities	16		16		—		16		—
Money market funds	8		8		8		—		—
Municipal bonds	1		1		—		1		—
Total trust assets	157		157		8		149		—

Derivatives:^{a, d}
Embedded derivatives in provisional sales/purchase
contracts in a gross asset position	11		11		—		11		—
Crude oil and natural gas swaps	81		81		—		81		—
Total derivative assets	92		92		—		92		—

Total assets			$	356	$	94	$	262	$	—

Liabilities
Derivatives:^a
Embedded derivatives in provisional sales/purchase
contracts in a gross liability position^d	$	121	$	121	$	—	$	121	$	—
Crude oil options^d	116		116		—		—		116
Copper futures and swap contracts^d	14		14		13		1		—
Copper forward contracts^d	3		3		2		1		—
Plains Offshore warrants^e	$	79	$	79	$	—	$	—	$	79
Total derivative liabilities	333		333		15		123		195

Long-term debt, including current portion^f	21,215		20,335		—		20,335		—

Total liabilities			$	20,668	$	15	$	20,458	$	195



	At December 31, 2012
	Carrying		Fair Value
	Amount		Total		Level 1		Level 2		Level 3
Assets
Investment securities (current and long-term):
MMR investment^g	$	446	$	539	$	—	$	539	$	—
U.S. core fixed income fund^{a, c}	22		22		—		22		—
Money market funds^{a, c}	16		16		16		—		—
Equity securities^{a, c}	8		8		8		—		—
Total investment securities	492		585		24		561		—

Trust assets (long-term):^{a, c}
U.S. core fixed income fund	50		50		—		50		—
Government mortgage-backed securities	36		36		—		36		—
Corporate bonds	30		30		—		30		—
Government bonds and notes	24		24		—		24		—
Asset-backed securities	15		15		—		15		—
Money market funds	7		7		7		—		—
Municipal bonds	1		1		—		1		—
Total trust assets	163		163		7		156		—

Derivatives:^{a, d}
Embedded derivatives in provisional sales/purchase
contracts in a gross asset position	36		36		—		36		—
Copper futures and swaps contracts	5		5		5		—		—
Total derivative assets	41		41		5		36		—

Total assets			$	789	$	36	$	753	$	—

Liabilities
Derivatives:^{a, d}
Embedded derivatives in provisional sales/purchase
contracts in a gross liability position	$	27	$	27	$	—	$	27	$	—
Copper futures and swap contracts	1		1		1		—		—
Total derivative liabilities	28		28		1		27		—

Long-term debt, including current portion^f	3,527		3,589		—		3,589		—

Total liabilities			$	3,617	$	1	$	3,616	$	—


a.	Recorded at fair value.


b.	Investment securities excluded $238 million of time deposits at June 30, 2013.


c.	Current portion included in other current assets and long-term portion included in other assets.


d.	Crude oil options are net of $478 million for deferred premiums and accrued interest at June 30, 2013. Refer to Note 9 for further discussion and balance sheet classifications.


e.	Included in other liabilities. Refer to Note 2 for further discussion.


f.	Recorded at cost except for debt acquired in the PXP, MMR and FMC acquisitions, which were recorded at fair value at the acquisition dates.


g.	Recorded at cost and included in other assets.

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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