GUARANTOR FINANCIAL STATEMENTS

In March 2013, FCX completed the sale of $6.5 billion of senior notes. These notes, along with FCX's senior notes sold in February 2012, are fully and unconditionally guaranteed on a senior basis jointly and severally by FM O&G LLC, as guarantor, which is a 100 percent owned subsidiary of FM O&G and FCX. The guarantee is an unsecured obligation of the guarantor and ranks equal in right of payment with all existing and future indebtedness of FCX, including indebtedness under the revolving credit facility. The guarantee ranks senior in right of payment with all future subordinated obligations and is effectively subordinated in right of payment to any debt of FCX's subsidiaries that are not subsidiary guarantors. In the future, FM O&G LLC's guarantee may be released or terminated for certain obligations under the following circumstances: (i) all or substantially all of the equity interests or assets of FM O&G LLC are sold to a third party; or (ii) FM O&G LLC no longer has any obligations under any FM O&G senior notes or any refinancing thereof and no longer guarantees any obligations of FCX under the revolver, the term loan or any other senior debt.

The following condensed consolidating financial information includes information regarding FCX, as issuer, FM O&G LLC, as guarantor, and all other non-guarantor subsidiaries of FCX. Included are the condensed consolidating balance sheets at June 30, 2014, and December 31, 2013, and the related condensed consolidating statements of comprehensive income for the three and six months ended June 30, 2014 and 2013, and condensed consolidating statements of cash flows for the six months ended June 30, 2014 and 2013, which should be read in conjunction with FCX's notes to the consolidated financial statements (in millions). Certain amounts in the Condensed Consolidating Statement of Cash Flows for the six months ended June 30, 2013, have been reclassified to conform with the current period presentation. These amounts, which were not material, had no effect on the reported changes in cash and cash equivalents.

CONDENSED CONSOLIDATING BALANCE SHEET

June 30, 2014



	FCX			FM O&G LLC		Non-guarantor					Consolidated
	Issuer			Guarantor		Subsidiaries		Eliminations			FCX
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	1	$	1,457	$	—		$	1,458
Accounts receivable	388			2,840		2,466		(2,936		)	2,758
Other current assets	78			56		5,904		—			6,038
Total current assets	466			2,897		9,827		(2,936		)	10,254
Property, plant, equipment and mining development costs, net	25			45		25,337		—			25,407
Oil and gas properties, net - full cost method:
Subject to amortization, less accumulated amortization	—			4,583		6,460		14			11,057
Not subject to amortization	—			1,853		8,916		—			10,769
Investments in consolidated subsidiaries	32,769			10,107		11,416		(54,292		)	—
Goodwill	—			217		1,500		—			1,717
Other assets	6,346			3,432		4,241		(9,214		)	4,805
Total assets	$	39,606		$	23,134	$	67,697	$	(66,428	)	$	64,009

LIABILITIES AND EQUITY
Current liabilities	$	1,550		$	1,026	$	6,088	$	(1,106	)	$	7,558
Long-term debt, less current portion	12,435			6,762		5,885		(7,570		)	17,512
Deferred income taxes	4,244		^a	—		3,207		—			7,451
Environmental and asset retirement obligations, less current portion	—			291		3,003		—			3,294
Other liabilities	46			3,457		1,753		(3,474		)	1,782
Total liabilities	18,275			11,536		19,936		(12,150		)	37,597

Redeemable noncontrolling interest	—			—		745		—			745

Equity:
Stockholders' equity	21,331			11,598		43,140		(54,737		)	21,332
Noncontrolling interests	—			—		3,876		459			4,335
Total equity	21,331			11,598		47,016		(54,278		)	25,667
Total liabilities and equity	$	39,606		$	23,134	$	67,697	$	(66,428	)	$	64,009


a.	All U.S. related deferred income taxes are recorded at the parent company.

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2013



	FCX			FM O&G LLC		Non-guarantor					Consolidated
	Issuer			Guarantor		Subsidiaries		Eliminations			FCX
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	—	$	1,985	$	—		$	1,985
Accounts receivable	855			659		2,258		(1,210		)	2,562
Other current assets	114			38		5,273		—			5,425
Total current assets	969			697		9,516		(1,210		)	9,972
Property, plant, equipment and mining development costs, net	27			43		23,972		—			24,042
Oil and gas properties, net - full cost method:
Subject to amortization, less accumulated amortization	—			6,207		6,265		—			12,472
Not subject to amortization	—			2,649		8,238		—			10,887
Investments in consolidated subsidiaries	31,162			9,712		12,468		(53,342		)	—
Goodwill	—			437		1,479		—			1,916
Other assets	7,126			4,640		4,128		(11,710		)	4,184
Total assets	$	39,284		$	24,385	$	66,066	$	(66,262	)	$	63,473

LIABILITIES AND EQUITY
Current liabilities	$	1,003		$	758	$	4,222	$	(1,210	)	$	4,773
Long-term debt, less current portion	13,184			7,199		8,056		(8,045		)	20,394
Deferred income taxes	4,137		^a	—		3,273		—			7,410
Environmental and asset retirement obligations, less current portion	—			301		2,958		—			3,259
Other liabilities	26			3,436		1,893		(3,665		)	1,690
Total liabilities	18,350			11,694		20,402		(12,920		)	37,526

Redeemable noncontrolling interest	—			—		716		—			716

Equity:
Stockholders' equity	20,934			12,691		41,100		(53,791		)	20,934
Noncontrolling interests	—			—		3,848		449			4,297
Total equity	20,934			12,691		44,948		(53,342		)	25,231
Total liabilities and equity	$	39,284		$	24,385	$	66,066	$	(66,262	)	$	63,473


a.	All U.S. related deferred income taxes are recorded at the parent company.

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

Three and Six Months Ended June 30, 2014



Three Months Ended June 30, 2014
	FCX			FM O&G LLC			Non-guarantor						Consolidated
	Issuer			Guarantor			Subsidiaries			Eliminations			FCX
Revenues	$	—		$	570		$	4,952		$	—		$	5,522
Total costs and expenses	21			489			3,865			(6		)	4,369
Operating (loss) income	(21		)	81			1,087			6			1,153
Interest expense, net	(87		)	(44		)	(51		)	18			(164		)
Net (loss) gain on early extinguishment of debt	(1		)	6			—			—			5
Other income (expense), net	17			1			(8		)	(18		)	(8		)
Benefit from (provision for) income taxes	26			26			(378		)	(2		)	(328		)
Equity in affiliated companies' net earnings (losses)	548			126			154			(826		)	2
Net income (loss)	482			196			804			(822		)	660
Net income and preferred dividends attributable to noncontrolling interests	—			—			(180		)	2			(178		)
Net income (loss) attributable to FCX common stockholders	$	482		$	196		$	624		$	(820	)	$	482

Other comprehensive income	—			—			1			—			1
Total comprehensive income (loss)	$	482		$	196		$	625		$	(820	)	$	483




Six Months Ended June 30, 2014
	FCX			FM O&G LLC			Non-guarantor						Consolidated
	Issuer			Guarantor			Subsidiaries			Eliminations			FCX
Revenues	$	—		$	1,214		$	9,293		$	—		$	10,507
Total costs and expenses	32			1,015			7,204			(8		)	8,243
Operating (loss) income	(32		)	199			2,089			8			2,264
Interest expense, net	(169		)	(85		)	(109		)	38			(325		)
Net (loss) gain on early extinguishment of debt	(1		)	6			—			—			5
Other income (expense), net	37			1			25			(38		)	25
Benefit from (provision for) income taxes	5			(17		)	(670		)	(3		)	(685		)
Equity in affiliated companies' net earnings (losses)	1,152			256			339			(1,745		)	2
Net income (loss)	992			360			1,674			(1,740		)	1,286
Net income and preferred dividends attributable to noncontrolling interests	—			—			(291		)	(3		)	(294		)
Net income (loss) attributable to FCX common stockholders	$	992		$	360		$	1,383		$	(1,743	)	$	992

Other comprehensive income	—			—			4			—			4
Total comprehensive income (loss)	$	992		$	360		$	1,387		$	(1,743	)	$	996

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

Three and Six Months Ended June 30, 2013



Three Months Ended June 30, 2013
	FCX			FM O&G LLC			Non-guarantor						Consolidated
	Issuer			Guarantor			Subsidiaries			Eliminations			FCX
Revenues	$	—		$	162		$	4,126		$	—		$	4,288
Total costs and expenses	76			135			3,438			—			3,649
Operating (loss) income	(76		)	27			688			—			639
Interest expense, net	(92		)	(12		)	(39		)	11			(132		)
Gain on investment in MMR	128			—			—			—			128
Other income (expense), net	11			—			13			(11		)	13
Benefit from (provision for) income taxes	35			(5		)	(70		)	—			(40		)
Equity in affiliated companies' net earnings (losses)	476			20			(3		)	(491		)	2
Net income (loss)	482			30			589			(491		)	610
Net income and preferred dividends attributable to noncontrolling interests	—			—			(133		)	5			(128		)
Net income (loss) attributable to FCX common stockholders	$	482		$	30		$	456		$	(486	)	$	482

Other comprehensive income	—			—			5			—			5
Total comprehensive income (loss)	$	482		$	30		$	461		$	(486	)	$	487




Six Months Ended June 30, 2013
	FCX			FM O&G LLC			Non-guarantor						Consolidated
	Issuer			Guarantor			Subsidiaries			Eliminations			FCX
Revenues	$	—		$	162		$	8,709		$	—		$	8,871
Total costs and expenses	95			135			6,647			—			6,877
Operating (loss) income	(95		)	27			2,062			—			1,994
Interest expense, net	(128		)	(12		)	(64		)	15			(189		)
Losses on early extinguishment of debt	(45		)	—			—			—			(45		)
Gain on investment in MMR	128			—			—			—			128
Other income (expense), net	15			—			10			(15		)	10
Benefit from (provision for) income taxes	26			(5		)	(489		)	—			(468		)
Equity in affiliated companies' net earnings (losses)	1,229			20			(46		)	(1,199		)	4
Net income (loss)	1,130			30			1,473			(1,199		)	1,434
Net income and preferred dividends attributable to noncontrolling interests	—			—			(292		)	(12		)	(304		)
Net income (loss) attributable to FCX common stockholders	$	1,130		$	30		$	1,181		$	(1,211	)	$	1,130

Other comprehensive income	—			—			11			—			11
Total comprehensive income (loss)	$	1,130		$	30		$	1,192		$	(1,211	)	$	1,141

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six Months Ended June 30, 2014



	FCX			FM O&G LLC			Non-guarantor						Consolidated
	Issuer			Guarantor			Subsidiaries			Eliminations			FCX
Cash flow from operating activities:
Net income (loss)	$	992		$	360		$	1,674		$	(1,740	)	$	1,286
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Depreciation, depletion and amortization	2			545			1,440			(8		)	1,979
Net losses on crude oil and natural gas derivative contracts	—			120			—			—			120
Net gain (loss) on early extinguishment of debt	1			(6		)	—			—			(5		)
Equity in (earnings) losses of consolidated subsidiaries	(1,152		)	(256		)	39			1,367			(2		)
Other, net	121			(12		)	(123		)	—			(14		)
(Increases) decreases in working capital and changes in other tax payments	(164		)	(2,165		)	1,552			—			(777		)
Net cash (used in) provided by operating activities	(200		)	(1,414		)	4,582			(381		)	2,587

Cash flow from investing activities:
Capital expenditures	—			(897		)	(2,665		)	—			(3,562		)
Acquisition of Deepwater GOM interest	—			—			(925		)	—			(925		)
Intercompany loans	1,318			1,629			—			(2,947		)	—
Investment in consolidated subsidiary	(364		)	(96		)	1,079			(619		)	—
Net proceeds from sale of Eagle Ford shale assets	—			3,009			—			—			3,009
Other, net	—			(381		)	18			—			(363		)
Net cash provided by (used in) investing activities	954			3,264			(2,493		)	(3,566		)	(1,841		)

Cash flow from financing activities:
Proceeds from debt	890			—			358			—			1,248
Repayments of debt	(990		)	(224		)	(397		)	—			(1,611		)
Intercompany loans	—			(170		)	(2,777		)	2,947			—
Cash dividends and distributions paid	(653		)	(1,453		)	203			1,000			(903		)
Other, net	(1		)	(2		)	(4		)	—			(7		)
Net cash (used in) provided by financing activities	(754		)	(1,849		)	(2,617		)	3,947			(1,273		)

Net increase (decrease) in cash and cash equivalents	—			1			(528		)	—			(527		)
Cash and cash equivalents at beginning of period	—			—			1,985			—			1,985
Cash and cash equivalents at end of period	$	—		$	1		$	1,457		$	—		$	1,458

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six Months Ended June 30, 2013



	FCX			FM O&G LLC			Non-guarantor						Consolidated
	Issuer			Guarantor			Subsidiaries			Eliminations			FCX
Cash flow from operating activities:
Net income (loss)	$	1,130		$	30		$	1,473		$	(1,199	)	$	1,434
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Depreciation, depletion and amortization	2			79			772			6			859
Net loss on early extinguishment of debt	45			—			—			—			45
Gain on investment in MMR	(128		)	—			—			—			(128		)
Net losses on crude oil and natural gas derivative contracts	—			35			—			—			35
Equity in (earnings) losses of consolidated subsidiaries	(1,229		)	(20		)	52			1,193			(4		)
Other, net	27			(6		)	(202		)	—			(181		)
Decreases (increases) in working capital and changes in other tax payments, excluding amounts from acquisitions	142			31			(368		)	—			(195		)
Net cash (used in) provided by operating activities	(11		)	149			1,727			—			1,865

Cash flow from investing activities:
Capital expenditures	—			(151		)	(1,827		)	—			(1,978		)
Acquisitions, net of cash acquired	(5,437		)	—			(321		)	344			(5,414		)
Investment in consolidated subsidiary	104			—			—			(104		)	—
Other, net	(5		)	—			(259		)	—			(264		)
Net cash (used in) provided by investing activities	(5,338		)	(151		)	(2,407		)	240			(7,656		)

Cash flow from financing activities:
Proceeds from debt	10,885			—			136			—			11,021
Repayments of debt	(4,050		)	(415		)	(76		)	—			(4,541		)
Intercompany loans	(476		)	476			344			(344		)	—
Cash dividends and distributions paid	(595		)	—			(194		)	104			(685		)
Other, net	(415		)	—			—			—			(415		)
Net cash provided by (used in) financing activities	5,349			61			210			(240		)	5,380

Net increase (decrease) in cash and cash equivalents	—			59			(470		)	—			(411		)
Cash and cash equivalents at beginning of period	—			—			3,705			—			3,705
Cash and cash equivalents at end of period	$	—		$	59		$	3,235		$	—		$	3,294