Financial Instruments (Unaudited) (Tables)

3 Months Ended

Mar. 31, 2015

Financial Instruments [Abstract]

Unrealized gains (losses) for derivative financial instruments that are designated and qualify as fair value hedge transactions and for the related hedged item

A summary of gains (losses) recognized in revenues for derivative financial instruments related to commodity contracts that are designated and qualify as fair value hedge transactions, along with the unrealized gains (losses) on the related hedged item follows (in millions):

	Three Months Ended
	March 31,
	2015			2014
Copper futures and swap contracts:
Unrealized gains (losses):
Derivative financial instruments	$	6		$	(12	)
Hedged item – firm sales commitments	(6		)	12
Realized (losses) gains:
Matured derivative financial instruments	(10		)	2

Schedule of Derivative Instruments

At March 31, 2015, the outstanding 2015 crude oil option contracts, which settle monthly and cover approximately 23 million barrels over the remainder of 2015, follow:

		Daily Volumes (thousand barrels)	Average Strike Price (per barrel)a				Weighted-Average Deferred Premium  (per barrel)
2015 Period	Instrument Type		Floor		Floor Limit				Index
April - December	Put optionsb	84	$	90	$	70	$	6.89	Brent

a. The average strike prices do not reflect any premiums to purchase the put options.

b. If the index price is less than the per barrel floor, FCX receives the difference between the per barrel floor and the index price up to a maximum of $20 per barrel less the option premium. If the index price is at or above the per barrel floor, FCX pays the option premium and no cash settlement is received.

A summary of FCX’s embedded commodity derivatives at March 31, 2015, follows:

	Open Positions	Average Price Per Unit				Maturities Through
		Contract		Market
Embedded derivatives in provisional sales contracts:
Copper (millions of pounds)	577	$	2.75	$	2.74	September 2015
Gold (thousands of ounces)	155	1,195		1,183		July 2015
Embedded derivatives in provisional purchase contracts:
Copper (millions of pounds)	126	2.68		2.75		July 2015

Realized and unrealized gains (losses) for derivative financial instruments that do not qualify as hedge transactions

A summary of the realized and unrealized (losses) gains recognized in (loss) income before income taxes and equity in affiliated companies’ net earnings for commodity contracts that do not qualify as hedge transactions, including embedded derivatives, follows (in millions):

	Three Months Ended
	March 31,
	2015			2014
Embedded derivatives in provisional copper and gold
sales contractsa	$	(72	)	$	(169	)
Crude oil optionsa	52			(36		)
Natural gas swapsa	—			(14		)
Copper forward contractsb	(1		)	1

a. Amounts recorded in revenues. 

b. Amounts recorded in cost of sales as production and delivery costs.

Fair Values of Unsettled Derivative Financial Instruments

A summary of these unsettled commodity contracts that are offset in the balance sheet follows (in millions):

	Assets				Liabilities
	March 31, 2015		December 31, 2014		March 31, 2015		December 31, 2014
Gross amounts recognized:
Commodity contracts:
Embedded derivatives in provisional
sales/purchase contracts	$	46	$	15	$	60	$	93
Crude oil derivatives	268		316		—		—
Copper derivatives	7		—		5		7
	321		331		65		100
Less gross amounts of offset:
Commodity contracts:
Embedded derivatives in provisional
sales/purchase contracts	9		1		9		1
Copper derivatives	5		—		5		—
	14		1		14		1
Net amounts presented in balance sheet:
Commodity contracts:
Embedded derivatives in provisional
sales/purchase contracts	37		14		51		92
Crude oil derivatives	268		316		—		—
Copper derivatives	2		—		—		7
	$	307	$	330	$	51	$	99
Balance sheet classification:
Trade accounts receivable	$	32	$	5	$	22	$	56
Other current assets	270		316		—		—
Accounts payable and accrued liabilities	5		9		29		43
	$	307	$	330	$	51	$	99

A summary of the fair values of unsettled commodity derivative financial instruments follows (in millions):

	March 31, 2015		December 31, 2014
Commodity Derivative Assets:
Derivatives designated as hedging instruments:
Copper futures and swap contractsa	$	4	$	—
Derivatives not designated as hedging instruments:
Embedded derivatives in provisional copper and gold
sales/purchase contracts	46		15
Crude oil optionsb	268		316
Copper forward contracts	3		—
Total derivative assets	$	321	$	331
Commodity Derivative Liabilities:
Derivatives designated as hedging instruments:
Copper futures and swap contractsa	$	5	$	7
Derivatives not designated as hedging instruments:
Embedded derivatives in provisional copper and gold
sales/purchase contracts	60		93
Total derivative liabilities	$	65	$	100

a. FCX paid $5 million to brokers at March 31, 2015, and $10 million at December 31, 2014, for margin requirements (recorded in other current assets).

b. Amounts are net of $159 million at March 31, 2015, and $210 million at December 31, 2014, for deferred premiums and accrued interest.