FAIR VALUE MEASUREMENT (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Measurement Inputs Disclosure

A summary of the carrying amount and fair value of FCX’s financial instruments (including those measured at net asset value (NAV) as a practical expedient), other than cash and cash equivalents, restricted cash, restricted cash equivalents, accounts receivable, accounts payable and accrued liabilities, and dividends payable (refer to Note 6) follows (in millions):



	At June 30, 2020
	Carrying		Fair Value
	Amount		Total		NAV		Level 1		Level 2		Level 3
Assets
Investment securities:^a,b
U.S. core fixed income fund	$	29	$	29	$	29	$	—	$	—	$	—
Equity securities	5		5		—		5		—		—
Total	34		34		29		5		—		—

Legally restricted funds:^a
U.S. core fixed income fund	63		63		63		—		—		—
Corporate bonds	45		45		—		—		45		—
Government mortgage-backed securities	40		40		—		—		40		—
Government bonds and notes	32		32		—		—		32		—
Asset-backed securities	14		14		—		—		14		—
Money market funds	9		9		—		9		—		—
Collateralized mortgage-backed securities	4		4		—		—		4		—
Municipal bonds	1		1		—		—		1		—
Total	208		208		63		9		136		—

Derivatives:
Embedded derivatives in provisional sales/purchase contracts in a gross asset position^c	77		77		—		—		77		—
Copper futures and swap contracts^c	13		13		—		11		2		—
Copper forward contracts^c	4		4		—		2		2		—
Total	94		94		—		13		81		—

Contingent consideration for the sale of the
Deepwater GOM oil and gas properties^a	115		78		—		—		—		78

Liabilities
Derivatives:^c
Embedded derivatives in provisional sales/purchase contracts in a gross liability position	28		28		—		—		28		—
Copper forward contracts	6		6		—		2		4		—
Total	34		34		—		2		32		—

Long-term debt, including current portion^d	9,914		10,013		—		—		10,013		—



	At December 31, 2019
	Carrying		Fair Value
	Amount		Total		NAV		Level 1		Level 2		Level 3
Assets
Investment securities:^a,b
U.S. core fixed income fund	$	27	$	27	$	27	$	—	$	—	$	—
Equity securities	4		4		—		4		—		—
Total	31		31		27		4		—		—

Legally restricted funds:^a
U.S. core fixed income fund	59		59		59		—		—		—
Government mortgage-backed securities	43		43		—		—		43		—
Government bonds and notes	36		36		—		—		36		—
Corporate bonds	33		33		—		—		33		—
Asset-backed securities	14		14		—		—		14		—
Collateralized mortgage-backed securities	7		7		—		—		7		—
Money market funds	3		3		—		3		—		—
Municipal bonds	1		1		—		—		1		—
Total	196		196		59		3		134		—

Derivatives:
Embedded derivatives in provisional sales/purchase contracts in a gross asset position^c	68		68		—		—		68		—
Copper futures and swap contracts^c	6		6		—		5		1		—
Contingent consideration for the sale of onshore
California oil and gas properties^a	11		11		—		—		11		—
Total	85		85		—		5		80		—

Contingent consideration for the sale of the
Deepwater GOM oil and gas properties^a	122		108		—		—		—		108

Liabilities
Derivatives:^c
Embedded derivatives in provisional sales/purchase contracts in a gross liability position	20		20		—		—		20		—
Copper forward contracts	1		1		—		—		1		—
Total	21		21		—		—		21		—

Long-term debt, including current portion^d	9,826		10,239		—		—		10,239		—


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

Excludes time deposits (which approximated fair value) included in (i) other current assets of $132 million at June 30, 2020, and $100 million at December 31, 2019, and (ii) other assets of $131 million at June 30, 2020, and $157 million at December 31, 2019, primarily associated with an assurance bond to support PT-FI’s commitment for the development of a new smelter in Indonesia and PT-FI’s closure and reclamation guarantees.


c.	Refer to Note 6 for further discussion and balance sheet classifications.


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

Summary of Unobservable Input Reconciliation

A summary of the changes in the fair value of FCX’s Level 3 instrument, contingent consideration for the sale of the Deepwater GOM oil and gas properties, during the first six months of 2020 follows (in millions):



Fair value at January 1, 2020	$	108
Net unrealized loss related to assets still held at the end of the period	(22		)
Settlements	(8		)
Fair value at June 30, 2020	$	78