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8-K - FORM 8-K - FREEPORT-MCMORAN INC | h84808e8vk.htm |
Exhibit 99.1
Freeport-McMoRan Copper & Gold Inc.
Announces Impacts from PT-FI Labor Strike
Announces Impacts from PT-FI Labor Strike
PHOENIX, AZ, September 21, 2011 Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) is
providing this update on the status of PT Freeport Indonesias (PT-FI) Grasberg operations in
Papua, Indonesia following a labor strike which began on September 15, 2011.
PT-FI is negotiating a two-year extension of its bi-annual Collective Labor Agreement which is
scheduled for renewal on September 30, 2011. On September 15, 2011, PT-FIs union workforce, which
includes approximately 8,000 hourly employees, commenced a 30-day strike. There is no legal basis
for the strike under Indonesian law.
PT-FI is committed to work in good faith with union leaders and representatives of the
mediation team appointed by the Government of Indonesia to reach agreement on the new labor
agreement and to restore normal operations. The compensation package being proposed by PT-FI is
highly competitive and includes a substantial increase in base compensation, an enhanced bonus
program, attractive retirement benefits and other benefits for the employees and their families.
The strike has limited mining, milling and concentrate shipping activities at PT-FI.
Approximately 50% of the workforce, primarily contractors and non-union staff employees, have
reported to work and are maintaining critical operations so that full operations can resume quickly
upon conclusion of the strike. PT-FI is developing revised operating plans, which will be
implemented during the strike, to begin increasing mining and milling rates with a reduced
workforce.
The estimated impact of the work stoppage to aggregate daily production, including joint
venture interests, approximates 3 million pounds of copper and 5 thousand ounces of gold for each
day of the work stoppage. PT-FI is seeking to minimize the production and cost impacts associated
with the strike.
FCXs consolidated third quarter sales estimates, reported in July 2011, of 940 million pounds
of copper and 415 thousand ounces of gold are expected to be unfavorably impacted by the strike.
FCX will provide updated estimates as additional information becomes available about the duration
of the strike and PT-FIs mitigation efforts, including the effect of revised operating plans.
James R. Moffett, Chairman of the Board and Richard C. Adkerson, President and Chief Executive
Officer, said, The PT-FI management team continues to work diligently and constructively to reach
agreement on a new labor agreement that is reasonable and fair to all parties. In 2010, the
contribution from Grasberg to the Government of Indonesia and the local community, including taxes
and domestic wages and procurement totaled more than $3.8 billion. We are committed to maintaining
an attractive work environment for our employees and look forward to concluding the negotiations on
a mutually agreed basis as soon as possible.
FCX is a leading international mining company with headquarters in Phoenix, Arizona. FCX
operates large, long-lived, geographically diverse assets with significant proven and probable
reserves of copper, gold and molybdenum. FCX has a dynamic portfolio of operating, expansion and
growth projects in the copper industry and is the worlds largest producer of molybdenum.
The companys portfolio of assets includes the Grasberg minerals district, the worlds largest
copper and gold mine in terms of recoverable reserves; significant mining operations in the
Americas, including the large-scale Morenci and Safford minerals districts in North America and the
Cerro Verde and El Abra operations in South America; and the Tenke Fungurume minerals district in
the DRC. Additional information about FCX is available on FCXs website at www.fcx.com.
Cautionary Statement. This press release contains forward-looking statements in which FCX
discusses its potential future performance. Forward-looking statements are all statements other
than statements of historical facts, such as those statements regarding projected ore grades and
milling rates, projected production and sales volumes, projected unit net cash costs, projected
operating cash flows, projected capital expenditures, exploration efforts and results, mine
production and development plans, liquidity, other financial commitments and tax rates, the impact
of copper, gold, molybdenum and cobalt price changes, potential prepayments of debt, future
dividend payments and potential share purchases. The words anticipates, may, can, plans,
believes, estimates, expects, projects, intends, likely, will, should, to be, and
any similar expressions are intended to identify those assertions as forward-looking statements.
FCX cautions readers that forward-looking statements are not guarantees of future performance
and its actual results may differ materially from those anticipated, projected or assumed in the
forward-looking statements. Important factors that can cause FCXs actual results to differ
materially from those anticipated in the forward-looking statements include commodity prices, mine
sequencing, production rates, industry risks, regulatory changes, political risks, the potential
effects of violence in Indonesia, the resolution of administrative disputes in the Democratic
Republic of Congo, weather-related risks, labor relations, including the resolution of labor
negotiations in Indonesia, environmental risks, litigation results, currency translation risks and
other factors described in more detail under the heading Risk Factors in FCXs Annual Report on
Form 10-K for the year ended December 31, 2010, filed with the U.S. Securities and Exchange
Commission (SEC) as updated by our subsequent filings with the SEC.
Investors are cautioned that many of the assumptions on which our forward-looking statements
are based are likely to change after our forward-looking statements are made, including for example
commodity prices, which we cannot control, and production volumes and costs, some aspects of which
we may or may not be able to control. Further, we may make changes to our business plans that could
or will affect our results. We caution investors that we do not intend to update our
forward-looking statements notwithstanding any changes in our assumptions, changes in our business
plans, our actual experience, or other changes, and we undertake no obligation to update any
forward-looking statements more frequently than quarterly.
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