FCX Discussion

Materials

FCX Discussion

Materials

January 2013

January 2013

FILED BY FREEPORT-MCMORAN COPPER & GOLD INC.

PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933

SUBJECT COMPANY: PLAINS EXPLORATION & PRODUCTION COMPANY

REGISTRATION STATEMENT NO. 333-185747

www.fcx.com

CONNECTING THE FUTURE

®

2

Cautionary Statement

Regarding Forward-Looking Statements

Cautionary Statement

Regarding Forward-Looking Statements

This presentation contains forward-looking statements concerning the proposed transaction, its financial and business impact,

management’s beliefs and objectives with respect thereto, and management’s current expectations for future operating and

financial performance, based on assumptions currently believed to be valid. Forward-looking statements are all statements

other than statements of historical facts. The words “anticipates,”

“may,”

“can,”

“plans,”

“believes,”

“estimates,”

“expects,”

“projects,”

“intends,”

“likely,”

“will,”

“should,”

“to be,”

and any similar expressions or other words of similar meaning are

intended to identify those assertions as forward-looking statements. It is uncertain whether the events anticipated will

transpire, or if they do occur what impact they will have on the

results of operations and financial condition of FCX or of the

combined company.  These forward-looking statements involve significant risks and uncertainties that could cause actual

results to differ materially from those anticipated, including but not limited to the ability of the parties to satisfy the conditions

precedent and consummate either or both of the proposed transactions, the timing of consummation of either or both of the

proposed transactions, the ability of the parties to secure regulatory approvals in a timely manner or on the terms desired or

anticipated, the ability of FCX to integrate the acquired operations, the ability to implement the anticipated business plans

following closing and achieve anticipated benefits and savings, and the ability to realize opportunities for growth.  Other

important economic, political, regulatory, legal, technological,

competitive and other uncertainties are identified in the

documents filed with the Securities and Exchange Commission (the

“SEC”) by FCX, Plains Exploration & Production Company

and McMoRan Exploration Co. from time to time, including their Annual Reports on Form 10-K, Quarterly Reports on

Form 10-Q, and Current Reports on Form 8-K and other documents filed in connection with the proposed transactions.  The

forward-looking statements including in this presentation are made only as of the date hereof.  FCX undertakes no obligation

to update the forward-looking statements included in this presentation to reflect subsequent events or circumstances.

The SEC requires oil and gas companies, in their filings with the SEC, to disclose proved reserves that a company has

demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing

economic and operating conditions. Beginning with year-end reserves for 2009, the SEC permits oil and gas companies, in

their filings with the SEC, to disclose probable and possible reserves, as such terms are defined by the SEC. We use certain

phrases and terms in this presentation, such as "gross unrisked potential”

and “reserve potential," which the SEC's guidelines

prohibit us from including in filings with the SEC. “Gross unrisked potential”

and “reserve potential”

do not take into account

the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access,

commerciality and other factors, and are therefore not indicative of expected future resource recovery and should not be

relied upon. We urge you to consider closely the disclosure of proved reserves included in McMoRan Exploration Co.’s Annual

Report on Form 10-K for the year ended December 31, 2011.

3

Additional Information about the

Proposed Transactions and Where to Find It

Additional Information about the

Proposed Transactions and Where to Find It

PXP Transaction

In connection with the proposed transaction, FCX has filed with the SEC a registration statement on Form S-4 that includes a preliminary proxy statement of

PXP

that

also

constitutes

a

prospectus

of

FCX.

FCX

and

PXP

also

plan

to

file

other

relevant

documents

with

the

SEC

regarding

the

proposed

transaction.

INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF AND WHEN THEY

BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. You may obtain a free copy of the definitive proxy statement/prospectus (if

and

when

it

becomes

available)

and

other

relevant

documents

filed

by

FCX

and

PXP

with

the

SEC

at

the

SEC’s

website

at

www.sec.gov.

You

may

also

obtain

these

documents

by

contacting

FCX’s

Investor

Relations

department

at

(602)

366-8400,

or

via

e-mail

at

IR@fmi.com;

or

by

contacting

PXP’s

Investor

Relations

department

at

(713)

579-6291,

or

via

email

at

investor@pxp.com.

FCX

and

PXP

and

their

respective

directors

and

executive

officers

and

other

members

of

management

and

employees

may

be

deemed

to

be

participants

in

the

solicitation of proxies in respect of the proposed transaction. Information about FCX’s directors and executive officers is available in FCX’s proxy statement

dated April 27, 2012, for its 2012 Annual Meeting of Stockholders. Information about PXP’s directors and executive officers is available in PXP’s proxy

statement

dated

April

13,

2012,

for

its

2012

Annual

Meeting

of

Stockholders.

Other

information

regarding

the

participants

in

the

proxy

solicitation

and a

description

of

their

direct

and

indirect

interests,

by

security

holdings

or

otherwise,

will

be

contained

in

the

definitive

proxy

statement/prospectus

and

other

relevant

materials

to

be

filed

with

the

SEC

regarding

the

merger

when

they

become

available.

Investors

should

read

the

definitive

proxy

statement/prospectus

carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from FCX or PXP using

the sources indicated above.

This document shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction

in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of

securities

shall

be

made

except

by

means

of

a

prospectus

meeting

the

requirements

of

Section

10

of

the

U.S.

Securities

Act

of

1933,

as

amended.

MMR  Transaction

In connection with the proposed transaction, the royalty trust formed in connection with the transaction has filed with the SEC a registration statement on

Form S-4 that includes a preliminary proxy statement of MMR that also constitutes a prospectus of the royalty trust. FCX, the royalty trust and MMR also plan

to file other relevant documents with the SEC regarding the proposed transaction. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS

AND

OTHER

RELEVANT

DOCUMENTS

FILED

WITH

THE

SEC

IF

AND

WHEN

THEY

BECOME

AVAILABLE,

BECAUSE

THEY

WILL

CONTAIN

IMPORTANT

INFORMATION. You may obtain a free copy of the proxy statement/prospectus (if and when it becomes available) and other relevant documents filed by FCX,

the

royalty

trust

and

PXP

with

the

SEC

at

the

SEC’s

website

at

www.sec.gov.

You

may

also

obtain

these

documents

by

contacting

FCX’s

Investor

Relations

department

at

(602)

366-8400,

or

via

e-mail

at

IR@fmi.com;

or

by

contacting

MMR’s

Investor

Relations

department

at

(504)

582-4000,

or

via

email at

IR@fmi.com.

FCX

and

MMR

and

their

respective

directors

and

executive

officers

and

other

members

of

management

and

employees

may

be

deemed

to

be

participants

in

the solicitation of proxies in respect of the proposed transaction. Information about FCX’s directors and executive officers is available in FCX’s proxy statement

dated April 27, 2012, for its 2012 Annual Meeting of Stockholders. Information about MMR’s directors and executive officers is available in MMR’s proxy

statement

dated

April

27,

2012,

for

its

2012

Annual

Meeting

of

Stockholders.

Other

information

regarding

the

participants

in

the

proxy

solicitation

and a

description

of

their

direct

and

indirect

interests,

by

security

holdings

or

otherwise,

will

be

contained

in

the

definitive

proxy

statement/prospectus

and

other

relevant

materials

to

be

filed

with

the

SEC

regarding

the

merger

when

they

become

available.

Investors

should

read

the

definitive

proxy

statement/prospectus

carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from FCX or MMR using

the sources indicated above.

This document shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction

in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of

securities

shall

be

made

except

by

means

of

a

prospectus

meeting

the

requirements

of

Section

10

of

the

U.S.

Securities

Act

of

1933,

as

amended.

4

Recent Acquisitions –

Why Now?

Recent Acquisitions –

Why Now?

Positive Long-Term Global Economic Outlook

Limited Opportunities to Invest in Copper Beyond Brown Field

Expansions

Attractive Opportunity to Acquire High Quality Assets

•

Strong Margins and Cash Flows (Self-funding Growth)

•

Financially Attractive Growth Options

•

Enhances

Diversification

–

Commodity/Geographic

•

Enhances

Exploration

Leverage

–

Multiple

High

Quality

Targets

•

Attractive Entry Point for Long Term Natural Gas Business

•

Opportunity for Stronger Long Term Returns for Shareholders

Management Capabilities to Execute

Enhanced Size and Scale to Compete Globally

Access to Low Cost Debt Financing

5

2012e Copper Production

World Class Copper

Discoveries Are Extremely Rare

World Class Copper

Discoveries Are Extremely Rare

Recoverable Copper Reserves

Million metric tons

Thousand metric tons

Source: Brook Hunt

e=estimate

0

200

400

600

800

1000

1200

Escondida - 1979

Chuquicamata - 1910

Antamina - 1996

El Teniente - 1910

Los Pelambres - 1996

Los Bronces - 1867

Collahuasi - 1979

Norilsk - 1935

Grasberg Complex - 1988

Morenci - 1870s

0

5

10

15

20

25

30

Grasberg Complex -

1988

KGHM Polish Copper -

1957

Escondida -

1979

Cananea -

1926

Collahuasi -

1979

Andina -

1865

El Teniente -

1910

Chuquicamata -

1910

Oyu Tolgoi -

2001

Cerro Verde -

1860s

Positive Exploration Results –

“Big Mines Get Bigger”

Mines with Potential Capacity for

1 billion lbs of copper per annum*

Morenci

Morenci

Grasberg

Grasberg

Tenke

Fungurume

Tenke

Fungurume

Cerro Verde

Cerro Verde

El Abra

El Abra

*

Grasberg currently producing over 1 bln lbs/annum, Morenci (100%) & Cerro Verde in development

to

produce

1

bln

lbs/annum

and

El

Abra

&

Tenke

have

potential

to

produce

1

bln

lbs/annum

*

Grasberg currently producing over 1 bln lbs/annum, Morenci (100%) & Cerro Verde in development

to

produce

1

bln

lbs/annum

and

El

Abra

&

Tenke

have

potential

to

produce

1

bln

lbs/annum

6

Attractive Portfolio of

Brownfield Copper Expansions

Attractive Portfolio of

Brownfield Copper Expansions

575 MMBOE

California

38%

California

38%

4%

4%

Eagle Ford

6%

6%

Haynesville

22%

Haynesville

22%

Other

Deepwater

GOM

25%

Deepwater

GOM

25%

5%

GOMS

helf

Proved Reserves

(1)

Transaction Adds

High Quality U.S. Oil & Gas Portfolio

Transaction Adds

High Quality U.S. Oil & Gas Portfolio

7

(1)

PXP Reserves as of 12/31/11 except for reserves purchased in deepwater acquisitions which are as of 9/30/12; MMR reserves are mid-year 2012 pro

forma for 2H12 divestitures.

(2)

Based on pricing assumptions of $100/bbl Oil (Brent) and $4.50/MMbtu natural gas.

Natural Gas

Oil

e = estimate. See Cautionary Statement.

Strong Margins and Cash Flows to Fund Growth

O&G EBITDA Margins of ~75%

(2)

CAPEX Targeted to be Self-funded

Enhanced Geographic &

Commodity Diversification

8

2013e EBITDA

(1)

North

America

North

America

Indonesia

Indonesia

31%

31%

29%

29%

South

America

29%

Africa

11%

11%

Mining

100%

Mining

100%

Oil & Gas

26%

Oil & Gas

26%

Mining

74%

Mining

74%

North

America

North

America

Indonesia

Indonesia

23%

23%

48%

48%

South

America

21%

Africa

8%

8%

Existing

(1)

Based

on

pricing

assumptions

of

$3.50/lb

Cu,

$1,500/oz

Au,

$12/lb

Mo,

$100/bbl

Oil

(Brent)

and

$4.50/MMbtu

natural

gas.

Pro forma

e

=

estimate.

See

Cautionary

Statement.

Enhanced Exploration Leverage

with Multiple Near-term Catalysts

Enhanced Exploration Leverage

with Multiple Near-term Catalysts

9

Near-term Net Potential

of 995 MMBOE

•

Phobos (~300 MMBOE)

Spud in 4Q12

•

On Lease Exploration

from BP: 300+ MMBOE

•

Each 100 MM Barrels =

PV-10 of ~$2.5 Billion

Pre-tax

(1)

3 Wells Drilling

Recent Positive Results on

Lineham Creek Onshore

High Potential Prospect

Inventory

~50 Tcfe of Net Potential,

Including ~30 Tcfe from

Near-term Prospects

Each 2 Tcfe Net = PV-10 of

~$2.5

Billion

Pre-tax

(2)

Eagle Ford –

71 MMBOE

Haynesville –

~1 Tcfe

California –

+100 MMBOE

Deepwater GOM

Shallow Water Ultra-Deep

Onshore U.S.

(1)

Based on $100.00/bbl LLS oil 

(2)

Based on $4.50/MMbtu natural gas

Grasberg

Development & Expansion

Grasberg

Development & Expansion

The discovery of Grasberg in 1988 transformed

PT-FI into one of the world’s largest operations

Mill Rate

10

March 1988

$1.07

$444

1989 –

1997

$1.09

$369

1998 –

2004

$0.84

$315

2005 –

2012

$3.06

$1,008

Copper ($/lb)

Gold ($/oz)

Grasberg

Discovered

Expansion

Expansion

Expansion

Expansion

0

50

100

150

200

250

Gross Unrisked Potential*:

Shelf Prospects: ~100 Tcfe; Onshore Prospects: ~30 Tcfe

11

MMR’s Ultra-Deep Play

Grasberg of the Gulf of Mexico?

MMR’s Ultra-Deep Play

Grasberg of the Gulf of Mexico?

BONNET

ENGLAND

DRAKE

HOOK

CAPTAIN BLOOD

BARATARIA

CALICO JACK

DAVY JONES

BLACKBEARD EAST

BLACKBEARD WEST

(#2 in progress)

MMR Wilcox/Cretaceous Play

MMR Miocene/Wilcox Play

MMR Oligocene/Frio Play

BARBOSA

MORGAN

QUEEN ANNE’S

REVENGE

LAFITTE

LINEHAM CREEK

(in progress)

HIGHLANDER

(in progress)

ONSHORE

PROSPECT “B”

Ultra-Deep Prospects

Ultra-Deep Discoveries

McMoRan Acreage

Onshore Ultra-Deep

Prospects

DAVY JONES

WEST

MMR’s WI & NRI will vary on a per prospect basis based on unitization and parties’ participation.

NOTE: We use certain phrases and terms in this presentation, such as "gross unrisked potential” and “reserve potential” which the SEC's guidelines

prohibit us from including in filings with the SEC. See Cautionary Statement.

Energy –

A Significant

Component of Mining Cost

2012e

Materials

Materials

Energy

Energy

Manpower

Manpower

Other

Acid

30%

30%

21%

21%

30%

30%

13%

6%

Site Operating Costs by Category

(Consolidated)

2012e

Diesel

255 mm gallons

Diesel

255 mm gallons

Coal: 700k mt

&

Natural Gas:

1MMBTU

Purchased

Power

6,900 GWh

Purchased

Power

6,900 GWh

36%

36%

6%

6%

58%

58%

Components of Energy

(Total of $1.6 Billion)

12

e = estimate. See Cautionary Statement.

Proven Management Team

Proven Management Team

Complementary Management Teams with Substantial Experience and Track

Record of Success in Mining and Oil & Gas Exploration and Development

Global Industry Leading Capabilities:

-

Operational Excellence

-

Major Project Development

-

Technological Innovation

-

Exploration/Engineering

-

Prudent Environmental Management

History of Prudent Financial Management and Execution in Varying

Market Environments

13

Established Track Record of Capital Discipline and

Focus on Value Creation for Shareholders

Phelps Dodge Case Study

Highly Successful Transformational Transaction

Phelps Dodge Case Study

Highly Successful Transformational Transaction

14

$17.6

$7.2

$3.5

$0

$5

$10

$15

$20

Rapid Delevering

Consolidated Cash

$3.4

$1.6

$3.7

Net Debt/(Cash)

$14.2

$5.6

$(0.2)

At Time of PD

Acquisition in

March 2007

9/30/12

($ in bns)

Debt

*

Based on estimated proven & probable reserve additions as of 12/31/11 before production.

December

2007

Asset & Geographic

Diversification

Significant Reserve Additions

•

+46 billion lbs Cu*

Developed World-Class Copper

Portfolio

•

Recognized Industry Leader

•

Strong Current Production with

Substantial Growth Profile

•

Large Resource Position

Successful Integration

Effective Management During

2008/09 Economic Crisis

$91

$69

$57

$52

$44

$40

$31

$29

$0

$25

$50

$75

$100

$125

$150

XOM

CVX

COP

OXY

PF

FCX

APC

APA

EOG

CHK

MRO

($Bn)

Pro

forma

FCX

will

be

the

5

th

largest

U.S.

domiciled

natural

resource

company

and

the

5

th

largest

global

mining

company

by

enterprise

value

Source: Company filings, FactSet. Market data as of 1/7/2013.

* Includes U.S.-based E&P, mining and coal companies, including integrated companies. Midstream and downstream companies are excluded.

** Excludes precious metal companies

$405

$209

$138

$127

$122

$57

$55

$35

$26

$21

$21

$0

$25

$50

$75

$100

$125

$150

BHP

RIO

VALE

GLEN/

XTA

PF

FCX

AAL

SCCO

TCK

AA

ANTO

($Bn)

$223

Top US Domiciled Resource Companies*

Top US Domiciled Resource Companies*

Top Global Mining Companies**

Top Global Mining Companies**

A Premier U.S. Based

Natural Resource Company

A Premier U.S. Based

Natural Resource Company

15

Pro Forma

Review

Grasberg (90.64%)

Reserves

Cu

31.6 bn lbs

Au

32.2 mm ozs

Sales

Cu

1.1 bn lbs

Au

1.3 mm ozs

Reserves

Cu

40.6 bn lbs

Mo

2.71 bn lbs

Oil & Gas

575 mm bbls

Sales

Cu

1.45 bn lbs

Mo

90 mm lbs³

Oil & Gas

175 MBOE/d

FCX’s Global Footprint

FCX’s Global Footprint

Copper

Copper/Gold/Silver

Molybdenum

Cobalt

Oil/Natural Gas

Reserves

Cu

8.4 bn lbs

Co

0.86 bn lbs

Sales

Cu

400 mm lbs

Co

30+ mm lbs

Tenke (56.0%)

Tenke (56.0%)

South America

4

South America

4

Reserves

Cu

39.1 bn lbs

Au

1.3 mm ozs

Mo

0.71 bn lbs

Sales

Cu

1.35 bn lbs

Au

0.1 mm ozs

17

Note:

FCX

consolidated

reserves

and

annual

sales;

reserves

as

of

December

31,

2011.

Sales

figures

are

based

on

2013e. 

1

Cu operations: Morenci (85%), Sierrita (100%), Bagdad (100%), Tyrone (100%), Safford (100%), Miami (100%) and Chino (100%); Primary Mo: Henderson (100%)  and Climax (100%);

Oil & Gas operations: onshore/offshore CA, Madden, Eagle Ford, Haynesville, GOM shelf & Deepwater

2

PXP Reserves as of 12/31/11 except for reserves purchased in deepwater acquisitions which are as of 9/30/12; MMR reserves are mid-year 2012 pro forma for 2H12 divestitures

3 

Includes moly sales from South America

4

Cu operations: Candelaria/Ojos del Salado (80%), Cerro Verde (53.6%) and El Abra (51%)

Major Operations & Development Projects

All major mining assets majority-controlled and operated

Major Operations & Development Projects

All major mining assets majority-controlled and operated

North America

1

North America

1

e = estimate. See Cautionary Statement.

2

Reserves

(a)

(recoverable copper)

Reserves

(a)

&

Mineralized

Material

(b)

at $2.00 Cu price

(billion lbs of copper)

at $2.20 Cu price

Reserves

Mineralized

Material

(b)

(contained copper)

115

billion

lbs

Combined Reserves and Resources

Combined Reserves and Resources

18

2P Reserves

(c)

Reserves &

Resource Potential

Proved: 575

~7,900

923

(million barrels of oil

equivalents)

Probable: 348

Possible: 658

Near-term

Potential: ~6,300

120

235

(a)    Estimated recoverable proven and probable copper reserves as of 12/31/11 using a long-term average copper price of $2.00/lb; 96 billion pounds net to

FCX’s interest.

(b)  Estimated consolidated contained copper resources as of 12/31/11 using a long-term copper price of $2.20/lb. Mineralized Material is not included in

reserves and will not qualify as reserves until comprehensive engineering studies establish their economic feasibility. Accordingly, no

assurance can be given that the estimated mineralized material will become proven and probable reserves. See Cautionary Statement.

(c)

Includes PXP reserves as of 12/31/11 except for reserves purchased in deepwater acquisitions which are as of 9/30/12 and MMR reserves as of mid-year

2012 pro forma for 2H12 divestitures. Excludes results from GOM shelf ultra-deep activities.

19

19

North America*

*

excludes restarts currently in progress; incremental copper per annum

**

PT-FI’s share, average per annum

*

excludes restarts currently in progress; incremental copper per annum

**

PT-FI’s share, average per annum

19

Highly Attractive Brownfield

Copper Development Projects

Highly Attractive Brownfield

Copper Development Projects

South America*

South America*

Tenke

Fungurume

Grasberg

Grasberg

•

150mm lbs Cu/yr oxide

expansion nearing completion

•

Potential sulfide expansions

•

Morenci Expansion                      

(225 mm lbs Cu) under way

•

Potential sulfide expansions    

(~800 mm lbs Cu)

Mill Expansions

(t/d)

Cerro Verde (360K)

600

$4.4

2016

Morenci (115K)

225

1.4

2014 

Tenke (14K)

150

0.9

2013

TOTAL

975

$6.7

Expansion Projects in Progress

Incr. Cu

(mm lbs/yr)

Capital*

($ blns)

Achieve

Full Rates

* excludes capitalized interest

•

Cerro Verde Expansion     

(600 mm lbs Cu) under way

•

Potential El Abra Mill        

(600 mm lbs Cu)

Underground

development under

way

1.1 bln lbs Cu**

1.4 mm ozs Au**

20

Copper Sales (billion lbs)

Gold Sales (million ozs)

Diverse Production Profile

with Strong Growth

Diverse Production Profile

with Strong Growth

0

1

2

3

4

5

2012e

2013e

2014e

2015e

1.0

1.4

1.8

1.8

0

1

2

2012e

2013e

2014e

2015e

Molybdenum Sales (million lbs)

____________________

Note:  Consolidated copper sales include approximately 705 mm lbs in 2012e, 800 mm lbs in 2013e,

770 mm lbs in 2014e and 875+ mm lbs in 2015e for noncontrolling interest; excludes purchased copper.

* Includes Cerro Verde expansion (2016 full rates) & Morenci mill expansion, targeted for 2014.

e = estimate. See Cautionary Statement.

Includes Projects

Currently

Under Way*

3.6

5.0+

4.5

4.3

0

25

50

75

100

2012e

2013e

2014e

2015e

Oil & Gas Sales (MMBOE)

____________________

Note:  Consolidated

gold

sales

include

approximately

105k

ozs

in

2012e,

140k

ozs

in

2013e,

180k ozs in 2014e and 175k ozs in 2015e for noncontrolling interest.

____________________

Note:  2012e includes sales from GOM acquisition beginning on December 1, 2012. Oil & Gas

sales estimates include approximately 13.3 MMBOE in 2014e, and 22.6 MMBOE in 2015e

from potential success from ultra-deep Shelf exploration and development.

Ultra-Deep

Expl./Dev.

Ultra-Deep

Expl./Dev.

46

64

78

94

82

90

90

100

0

25

50

75

100

2012e

2013e

2014e

2015e

2013e

2014e

2015e

$0

$5

$10

$15

$20

$25

$3.00

$3.50

$4.00

FCX Pro forma EBITDA, Cash Flows &

Capital Expenditures

FCX Pro forma EBITDA, Cash Flows &

Capital Expenditures

21

$3.00

$3.50

$4.00

Operating Cash Flow*

EBITDA

CAPEX

Copper Prices

$1,500 Au/$12 Mo/$100 Oil/$4.50 Gas**

Copper Prices

$1,500 Au/$12 Mo/$100 Oil/$4.50 Gas**

* Excludes working capital changes

** See impacts of prices changes for gold, molybdenum, oil and gas on slide 32.

2015/

2016

Avg.

2013/

2014

Avg.

(Brent)

(Brent)

2015/

2016

Avg.

2013/

2014

Avg.

Mining

65%

O&G

35%

60%

40%

48%

52%

~45%

Increase

~45%

Increase

22

Focused and Disciplined

Capital Allocation Philosophy

Focused and Disciplined

Capital Allocation Philosophy

Maintain Strong Balance Sheet & Credit Profile

Allocate Capital to

Low Cost, Long-lived,

Expandable Assets

Focus on

Largest

Resources

Ensure

Potential

is Well

Understood

Establish Short,

Medium and Long

Term Potential for

Primary Assets

Quantify Risks

Technical, Political,

Social, Economic,

Market

Rigorous Economic

Analysis Under

Range of Assumptions

Protect Downside,

Leverage to Upside

Prioritize & Rank

Opportunities

Highest

Returns/NPV

per $

Invested

Manageable

Risks

Overall Portfolio

Balance/Strategic Fit

Limit Number of

Projects –

Focused

Management Attention

Repay

Debt

Return Excess Capital to

Shareholders

23

Capital Expenditures

(1)

Capital Expenditures

(1)

(US$ billions)

Other Mining

Major Mining Projects

Oil & Gas

3.0

1.6

1.4

1.0

2.5

3.0

2.0

3.3

2.9

$0

$2

$4

$6

$8

2013e

2014e

2015e

(1)

Capital expenditure estimates include projects in progress. Project spending will continue to be reviewed and revised subject to market conditions.

(2)  Primarily includes Cerro Verde expansion, Morenci mill expansion and Grasberg underground development.

Note: Includes capitalized interest.

e= estimate. See Cautionary Statement.

$7.1

$7.3

$6.3

(2)

(2)

Oil & Gas Cash Flows –

Targeted to be Self-funding

Oil & Gas Cash Flows –

Targeted to be Self-funding

24

$0.0

$1.0

$2.0

$3.0

$4.0

2013e

2014e

2015e

Operating Cash Flow

CAPEX

NOTE: Assumes pricing of $100/bbl Brent crude for oil and $4.50/MMbtu for natural gas

e= estimate. See Cautionary Statement.

(US$ billions)

$16.3

$7.7

$2.0

($3.5)

-$5

$0

$5

$10

$15

$20

Significant Debt Reduction

Significant Debt Reduction

Year-End Net Debt at Varying Copper Prices

Pro Forma YE 2016e

(US$ billions)

e= estimate. See Cautionary Statement.

’13-’16 Avg. Copper Price

Net Debt/’13-’16 Avg. EBITDA

$3.00

0.6x

$3.50

0.1x

$4.00

N/A

9/30/12

Pro Forma

25

Note:  Sensitivity assumes $12 Molybdenum, $1,500 Gold, $100 Oil and $4.50 Natural Gas; EBITDA equals operating income plus depreciation, depletion,  

and amortization

26

Maintain Strong Balance Sheet & Liquidity Position

Reduce Debt Incurred in Acquisitions Using Substantial Cash Flows

Generated from Combined Business

Invest in Projects with Strong Financial Returns/Capital Discipline

Anticipate Continuing Current Common Stock Dividend Rate:

$1.25/Share per Annum

Board to Review Financial Policy on an Ongoing Basis

Committed to Long-standing Tradition of Maximizing Value for

Shareholders

Financial Policy

Financial Policy

Reference

Slides

Transaction Summary

Price

FCX to acquire PXP for: 0.6531 shares of

FCX common stock and $25.00 in cash,

equivalent to total consideration of

$50.00 per PXP share based on FCX

closing price on December 4, 2012

FCX to acquire MMR for: $14.75 cash

plus 1.15 Ultra-Deep Royalty Trust

Units per MMR share

Premium

39% to PXP’s closing price on

December 4, 2012

Cash portion represents 74% to MMR’s

closing price on December 4, 2012

Structure

50% stock / 50% cash

$3.4 billion cash; 91 million new FCX

common shares

100% cash plus Ultra-Deep Royalty

Trust Units

(2)

Transaction Value

$17.2 billion (includes assumed debt)

$2.4 billion (includes assumed debt)

Key Conditions

Shareholders’

approval

Customary regulatory approvals and

conditions

Shareholders’

approval

Customary regulatory approvals and

conditions

Timing

Closing expected in 2Q 2013

FCX Pro Forma

Enterprise Value: $60 billion

1,041 million shares outstanding

Total Debt of $20.0 billion

(1) Prior to the transaction, FCX and PXP collectively own 36% of MMR

(2) Creation of Royalty Trust provides MMR shareholders 5% ORRI for continued participation in potential shallow water, ultra-deep GOM success

28

PXP

PXP

MMR

MMR

(1)

(1)

(1)

Includes ~ 7 MMcfe/d of natural gas

(2)

Includes ~ 4 MBOE/d of NGLs

(3)

Includes ~ 6 MBOE/d of NGLs

2013e Oil & Gas

Operating Estimates

2013e Oil & Gas

Operating Estimates

29

NOTE: e = estimate. See Cautionary Statement.

Oil

MBOE/D

40

(1)

California

Haynesville/

Rocky Mtns/Other

127

GOM

Eagle Ford

31

(2)

36

56

(3)

125

2013e Oil & Gas Sales by Region

2013e Oil & Gas Sales by Region

Operating Cost: $27/bbl

Pricing: Brent Based

Operating Cost: $15/bbl

Pricing: LLS

Operating Cost: $10/bbl

Pricing: LLS/NYMEX

Operating Cost: $1.65/Mcfe

Pricing: NYMEX

Gas

MMcfe/d

Rocky Mtns. &

Haynesville

Rocky Mtns. &

Haynesville

California

California

Eagle Ford

Eagle Ford

Gulf of Mexico Shelf/

Deepwater

Gulf of Mexico Shelf/

Deepwater

Oil & Natural Gas Hedging Positions

30

Oil Indexed to Brent

Swaps

Swaps

Puts

Collars

15%

Unhedged

Puts

15%

Unhedged

Puts

84k bbls/d

$90 floor

$70 limit

$6.90 ADP

43%

Unhedged

Natural Gas Indexed to Henry Hub

2013

2014

2015

Swaps –

100/d @ $4.09

117k bbls/d*

129k bbls/d*

147k bbls/d*

2013

2014

2015

40k bbls/d

@ $109.23

40k bbls/d

@ $109.23

30k bbls/d

$95 floor

$75 limit

$6.09 ADP

75k bbls/d

$90 floor

$70 limit

$5.74 ADP

5k bbls/d

$100 floor

$80 limit

$7.11 ADP

25k bbls/d

$100 floor

$80 limit

$124  Ceiling

5k bbls/d

$90 floor

$70 limit

$126 Ceiling

13k bbls/d

$100 floor

$80 limit

$6.80 ADP

17k bbls/d

$90 floor

$70 limit

$6.25 ADP

Swaps –

110/d @ $4.27

No Hedges

NOTE: As of October 19, 2012; ADP = average deferred premium.

* Estimated annual production for MMR & PXP. See Cautionary Statement.