Fair Value Measurement (Unaudited) (Tables)

6 Months Ended

Jun. 30, 2015

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 most significant Level 3 instruments, crude oil options, follows (in millions):



	Crude Oil
	Options
Fair value at December 31, 2014	$	316
Net realized gains	21
Net unrealized gains included in earnings related to assets and liabilities still held at the end of the period	36			^a
Net settlement receipts	(199		)	^b
Fair value at June 30, 2015	$	174


a.	Includes net unrealized gains of $37 million, partially offset by $1 million of interest expense associated with the deferred premiums.


b.	Includes interest payments of $2 million.

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, restricted cash, accounts payable and accrued liabilities, and dividends payable (refer to Note 7), follows (in millions):



	At June 30, 2015
	Carrying		Fair Value
	Amount		Total		Level 1		Level 2		Level 3
Assets
Investment securities:^a,b
U.S. core fixed income fund	$	23	$	23	$	—	$	23	$	—
Money market funds	22		22		22		—		—
Equity securities	3		3		3		—		—
Total	48		48		25		23		—

Legally restricted funds:^a,b,c,d
U.S. core fixed income fund	51		51		—		51		—
Government bonds and notes	35		35		—		35		—
Corporate bonds	28		28		—		28		—
Government mortgage-backed securities	24		24		—		24		—
Asset-backed securities	14		14		—		14		—
Money market funds	9		9		9		—		—
Collateralized mortgage-backed securities	8		8		—		8		—
Municipal bonds	1		1		—		1		—
Total	170		170		9		161		—

Derivatives:^a,e
Embedded derivatives in provisional sales/purchase
contracts in a gross asset position	21		21		—		21		—
Crude oil options	174		174		—		—		174
Total	195		195		—		21		174

Total assets			$	413	$	34	$	205	$	174

Liabilities
Derivatives:^a,e
Embedded derivatives in provisional sales/purchase
contracts in a gross liability position	$	65	$	65	$	—	$	65	$	—
Copper futures and swap contracts	5		5		5		—		—
Copper forward contracts	1		1		—		1		—
Total	71		71		5		66		—

Long-term debt, including current portion^f	20,902		20,191		—		20,191		—

Total liabilities			$	20,262	$	5	$	20,257	$	—



	At December 31, 2014
	Carrying		Fair Value
	Amount		Total		Level 1		Level 2		Level 3
Assets
Investment securities:^a,b
U.S. core fixed income fund	$	23	$	23	$	—	$	23	$	—
Money market funds	20		20		20		—		—
Equity securities	3		3		3		—		—
Total	46		46		23		23		—

Legally restricted funds:^a,b,c,d
U.S. core fixed income fund	52		52		—		52		—
Government bonds and notes	39		39		—		39		—
Corporate bonds	27		27		—		27		—
Government mortgage-backed securities	19		19		—		19		—
Asset-backed securities	17		17		—		17		—
Money market funds	11		11		11		—		—
Collateralized mortgage-backed securities	6		6		—		6		—
Municipal bonds	1		1		—		1		—
Total	172		172		11		161		—

Derivatives:^a,e
Embedded derivatives in provisional sales/purchase
contracts in a gross asset position	15		15		—		15		—
Crude oil options	316		316		—		—		316
Total	331		331		—		15		316

Total assets			$	549	$	34	$	199	$	316

Liabilities
Derivatives:^a,e
Embedded derivatives in provisional sales/purchase
contracts in a gross liability position	$	93	$	93	$	—	$	93	$	—
Copper futures and swap contracts	7		7		6		1		—
Total	100		100		6		94		—

Long-term debt, including current portion^f	18,849		18,735		—		18,735		—

Total liabilities			$	18,835	$	6	$	18,829	$	—


a.	Recorded at fair value.


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


c.	Excludes time deposits (which approximated fair value) included in other assets of $117 million at June 30, 2015, and $115 million at December 31, 2014, associated with an assurance bond to support PT Freeport Indonesia's (PT-FI) commitment for smelter development in Indonesia.


d.	Excludes time deposits (which approximated fair value) included in other current assets of $10 million at June 30, 2015, and $8 million at December 31, 2014, associated with a reclamation guarantee at PT-FI. Also, excludes a time deposit of $9 million at December 31, 2014, associated with a customs audit assessment.


e.	Refer to Note 7 for further discussion and balance sheet classifications. Crude oil options are net of $106 million at June 30, 2015, and $210 million at December 31, 2014, for deferred premiums and accrued interest.


f.	Recorded at cost except for debt assumed in acquisitions, which were recorded at fair value at the respective acquisition dates.