BUSINESS SEGMENTS INFORMATION

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Business Segment Information

BUSINESS SEGMENT INFORMATION

Product Revenues. FCX’s revenues attributable to the products it sold for the years ended December 31 follow:

	2021		2020		2019
Copper:
Concentrate	$	8,705	$	4,294	$	4,566
Cathode	5,900		4,204		3,656
Rod and other refined copper products	3,369		2,052		2,110
Purchased coppera	757		821		1,060
Gold	2,580		1,702		1,620
Molybdenum	1,283		848		1,169
Otherb	821		592		905
Adjustments to revenues:
Treatment charges	(445)		(362)		(404)
Royalty expensec	(330)		(165)		(113)
Export dutiesd	(218)		(92)		(221)
Revenues from contracts with customers	22,422		13,894		14,348
Embedded derivativese	423		304		54
Total consolidated revenues	$	22,845	$	14,198	$	14,402

a.FCX purchases copper cathode primarily for processing by its Rod & Refining operations.

b.Primarily includes revenues associated with silver and cobalt.

c.Reflects royalties on sales from PT-FI and Cerro Verde that will vary with the volume of metal sold and prices.

d.Reflects PT-FI export duties. The year 2019 includes charges totaling $155 million primarily associated with an unfavorable Indonesia Supreme Court ruling related to certain disputed export duties (refer to Note 12).

e.Refer to Note 14 for discussion of embedded derivatives related to FCX’s provisionally priced concentrate and cathode sales contracts.

Geographic Area. Information concerning financial data by geographic area follows:

	December 31,
	2021		2020
Long-lived assets:a
Indonesia	$	16,288	$	15,567
U.S.	8,292		8,420
Peru	6,827		6,989
Chile	1,110		1,172
Other	261		290
Total	$	32,778	$	32,438

a.Excludes deferred tax assets and intangible assets.

	Years Ended December 31,
	2021		2020		2019
Revenues:a
U.S.	$	7,168	$	5,248	$	5,107
Switzerland	3,682		2,032		2,223
Indonesia	3,132		1,760		1,894
Japan	2,372		1,205		1,181
Spain	1,495		785		884
China	1,044		692		531
United Kingdom	659		491		233
Germany	469		248		311
Chile	343		221		242
Korea	270		89		140
Egypt	268		153		123
Philippines	264		34		73
India	207		152		107
Other	1,472		1,088		1,353
Total	$	22,845	$	14,198	$	14,402

a.Revenues are attributed to countries based on the location of the customer.

Major Customers and Affiliated Companies. Copper concentrate sales to PT Smelting totaled 14 percent of FCX’s consolidated revenues in 2021, 12 percent in 2020 and 13 percent in 2019, and they are the only customer that accounted for 10 percent or more of FCX’s consolidated revenues during the three years ended December 31, 2021.

Consolidated revenues include sales to the noncontrolling interest owners of FCX’s South America mining operations totaling $1.4 billion in 2021, $0.9 billion in 2020 and $1.0 billion in 2019, and PT-FI’s sales to PT Smelting totaling $3.1 billion in 2021, $1.8 billion in 2020 and $1.9 billion in 2019.

Labor Matters. As of December 31, 2021, approximately 31 percent of FCX’s global labor force was covered by collective bargaining agreements, and approximately 14 percent was covered by agreements that will or were scheduled to expire during 2022. In February 2022, PT-FI completed negotiations with its unions on a new two-year collective bargaining agreement that is effective through March 2024.

Business Segments. FCX has organized its mining operations into four primary divisions - North America copper mines, South America mining, Indonesia mining and Molybdenum mines, and operating segments that meet certain thresholds are reportable segments. Separately disclosed in the following tables are FCX’s reportable segments, which include the Morenci, Cerro Verde and Grasberg (Indonesia Mining) copper mines, the Rod & Refining operations and Atlantic Copper Smelting & Refining.

Intersegment sales between FCX’s business segments are based on terms similar to arms-length transactions with third parties at the time of the sale. Intersegment sales may not be reflective of the actual prices ultimately realized because of a variety of factors, including additional processing, timing of sales to unaffiliated customers and transportation premiums.

FCX defers recognizing profits on sales from its mines to other segments, including Atlantic Copper Smelting & Refining and on PT-FI’s sales to PT Smelting (on 25.0 percent prior to April 30, 2021, and 39.5 percent thereafter) until final sales to third parties occur. Quarterly variations in ore grades, the timing of intercompany shipments and changes in product prices result in variability in FCX’s net deferred profits and quarterly earnings.

FCX allocates certain operating costs, expenses and capital expenditures to its operating divisions and individual segments. However, not all costs and expenses applicable to an operation are allocated. U.S. federal and state income taxes are recorded and managed at the corporate level (included in Corporate, Other & Eliminations), whereas foreign income taxes are recorded and managed at the applicable country level. In addition, most mining exploration and research activities are managed on a consolidated basis, and those costs, along with some selling, general and administrative costs, are not allocated to the operating divisions or individual segments. Accordingly, the following Financial Information by Business Segment reflects management determinations that may not be indicative of what the actual financial performance of each operating division or segment would be if it was an independent entity.

North America Copper Mines. FCX operates seven open-pit copper mines in North America - Morenci, Safford (including Lone Star), Bagdad, Sierrita and Miami in Arizona, and Chino and Tyrone in New Mexico. The North America copper mines include open-pit mining, sulfide-ore concentrating, leaching and SX/EW operations. A majority of the copper produced at the North America copper mines is cast into copper rod by FCX’s Rod & Refining segment. In addition to copper, certain of FCX’s North America copper mines also produce molybdenum concentrate, gold and silver.

The Morenci open-pit mine, located in southeastern Arizona, produces copper cathode and copper concentrate. In addition to copper, the Morenci mine also produces molybdenum concentrate. During 2021, the Morenci mine produced 43 percent of FCX’s North America copper and 16 percent of FCX’s consolidated copper production.

South America Mining. South America mining includes two operating copper mines - Cerro Verde in Peru and El Abra in Chile. These operations include open-pit mining, sulfide-ore concentrating, leaching and SX/EW operations.

The Cerro Verde open-pit copper mine, located near Arequipa, Peru, produces copper cathode and copper concentrate. In addition to copper, the Cerro Verde mine also produces molybdenum concentrate and silver. During 2021, the Cerro Verde mine produced 85 percent of FCX’s South America copper and 23 percent of FCX’s consolidated copper production.

Indonesia Mining. Indonesia mining includes PT-FI’s Grasberg minerals district that produces copper concentrate that contains significant quantities of gold and silver. During 2021, PT-FI’s Grasberg minerals district produced 35 percent of FCX’s consolidated copper production and 99 percent of FCX’s consolidated gold production.

Molybdenum Mines. Molybdenum mines include the wholly owned Henderson underground mine and Climax open-pit mine, both in Colorado. The Henderson and Climax mines produce high-purity, chemical-grade molybdenum concentrate, which is typically further processed into value-added molybdenum chemical products.

Rod & Refining. The Rod & Refining segment consists of copper conversion facilities located in North America, and includes a refinery and two rod mills, which are combined in accordance with segment reporting aggregation guidance. These operations process copper produced at FCX’s North America copper mines and purchased copper into copper cathode and rod. At times these operations refine copper and produce copper rod for customers on a toll basis. Toll arrangements require the tolling customer to deliver appropriate copper-bearing material to FCX’s facilities for processing into a product that is returned to the customer, who pays FCX for processing its material into the specified products.

Atlantic Copper Smelting & Refining. Atlantic Copper smelts and refines copper concentrate and markets refined copper and precious metals in slimes. During 2021, Atlantic Copper purchased 18 percent of its concentrate requirements from FCX’s North America copper mines, 7 percent from FCX’s South America mining operations and 9 percent from FCX’s Indonesia mining operations, with the remainder purchased from unaffiliated third parties.

Corporate, Other & Eliminations. Corporate, Other & Eliminations consists of FCX’s other mining, oil and gas operations and other corporate and elimination items, which include the Miami smelter, Freeport Cobalt (until the sale of it in September 2021), molybdenum conversion facilities in the U.S. and Europe, the greenfield smelter and PMR in Indonesia, certain non-operating copper mines in North America (Ajo, Bisbee and Tohono in Arizona) and other mining support entities.

Financial Information by Business Segment

	North America Copper Mines						South America Mining
																					Atlantic		Corporate,
																					Copper		Other
							Cerro							Indonesia			Molybdenum		Rod &		Smelting		& Elimi-			FCX
	Morenci		Other		Total		Verde			Other		Total		Mining			Mines		Refining		& Refining		nations			Total
Year Ended December 31, 2021
Revenues:
Unaffiliated customers	$	82	$	180	$	262	$	3,736		$	720	$	4,456	$	7,241		$	—	$	6,356	$	2,961	$	1,569	a	$	22,845
Intersegment	2,728		3,835		6,563		460			—		460		282			444		29		—		(7,778)			—
Production and delivery	1,226		2,235		3,461		2,000		b	429		2,429		2,425		c	253		6,381		2,907		(5,840)		d	12,016
Depreciation, depletion and amortization	152		217		369		366			47		413		1,049			67		5		28		67			1,998
Metals inventory adjustments	13		—		13		—			—		—		—			1		—		—		2			16
Selling, general and administrative expenses	2		2		4		8			—		8		111			—		—		24		236			383
Mining exploration and research expenses	—		1		1		—			—		—		—			—		—		—		54			55
Environmental obligations and shutdown costs	—		(1)		(1)		—			—		—		—			—		—		—		92			91
Net gain on sales of assets	—		—		—		—			—		—		—			—		—		(19)		(61)		e	(80)
Operating income (loss)	1,417		1,561		2,978		1,822			244		2,066		3,938			123		(1)		21		(759)			8,366
Interest expense, net	—		1		1		28			—		28		48			—		—		6		519			602
Provision for (benefit from) income taxes	—		—		—		730			90		820		1,524		f	—		—		—		(45)			2,299
Total assets at December 31, 2021	2,708		5,208		7,916		8,694			1,921		10,615		18,971			1,713		228		1,318		7,261			48,022
Capital expenditures	135		207		342		132			30		162		1,296			6		2		34		273		g	2,115

a.Includes revenues from FCX’s molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America and South America copper mines.

b.Includes nonrecurring charges totaling $92 million associated with labor-related charges at Cerro Verde for agreements reached with its hourly employees.

c.Includes charges totaling $340 million associated with unfavorable ARO change. Refer to Note 12 for further discussion.

d.Includes charges associated with the major maintenance turnaround at the Miami Smelter totaling $87 million.

e.Includes a $60 million gain on the sale of FCX’s remaining cobalt business located in Kokkola, Finland. Refer to Note 2 for further discussion.

f.Includes net tax benefits of $189 million associated with the release of a portion of the valuation allowance recorded against PT Rio Tinto NOLs. Refer to Note 11 for further discussion.

g.Includes capital expenditures for the Indonesia smelter projects of $222 million.

	North America Copper Mines						South America Mining
																						Atlantic		Corporate,
																						Copper		Other
							Cerro							Indonesia			Molybdenum		Rod &			Smelting		& Elimi-			FCX
	Morenci		Other		Total		Verde			Other		Total		Mining			Mines		Refining			& Refining		nations			Total
Year Ended December 31, 2020
Revenues:
Unaffiliated customers	$	29	$	48	$	77	$	2,282		$	431	$	2,713	$	3,534		$	—	$	4,781		$	2,020	$	1,073	a	$	14,198
Intersegment	2,015		2,272		4,287		242			—		242		80			222		33			17		(4,881)			—
Production and delivery	1,269		1,831		3,100		1,599			379		1,978		1,606			230		4,819			1,962		(3,664)			10,031
Depreciation, depletion and amortization	166		189		355		367			54		421		580			57		16			29		70			1,528
Metals inventory adjustments	4		48		52		—			3		3		—			10		3			—		28			96
Selling, general and administrative expenses	2		2		4		6			—		6		108			—		—			21		231			370
Mining exploration and research expenses	—		2		2		—			—		—		—			—		—			—		48			50
Environmental obligations and shutdown costs	—		(1)		(1)		—			—		—		—			—		1			—		159		b	159
Net gain on sales of assets	—		—		—		—			—		—		—			—		—			—		(473)		c	(473)
Operating income (loss)	603		249		852		552		d	(5)		547		1,320			(75)		(25)		d	25		(207)		d	2,437		d
Interest expense, net	2		—		2		139			—		139		39		e	—		—			6		412			598
Provision for income taxes	—		—		—		238			1		239		606			—		—			2		97		f	944
Total assets at December 31, 2020	2,574		5,163		7,737		8,474			1,678		10,152		16,918			1,760		211			877		4,489			42,144
Capital expenditures	102		326		428		141			42		183		1,161			19		6			29		135		g	1,961

a.Includes revenues from FCX’s molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America and South America copper mines.

b.Includes charges totaling $130 million associated with a framework for the resolution of all current and future potential talc-related litigation. Refer to Note 12 for further discussion.

c.Includes a $486 million gain associated with the sale of FCX’s interests in the Kisanfu undeveloped project. Refer to Note 2 for further discussion.

d.Includes charges totaling $258 million associated with (i) idle facility costs (Cerro Verde), contract cancellation and other charges directly related to the COVID-19 pandemic and (ii) the April 2020 revised operating plans (including employee separation costs). These charges were primarily recorded in the Cerro Verde segment ($89 million), Corporate, Other & Eliminations ($57 million) and the Rod & Refining segment ($30 million).

e.Includes charges totaling $35 million associated with PT-FI's historical contested tax audits. Refer to Note 12 for further discussion.

f.Includes tax charges totaling $135 million associated with the sale of the Kisanfu undeveloped project, partly offset by tax credits of $53 million associated with the reversal of a year-end 2019 tax charge related to the sale of FCX’s interest in the lower zone of the Timok exploration project.

g.Includes capital expenditures for the Indonesia smelter projects of $105 million.

	North America Copper Mines						South America Mining
																				Atlantic		Corporate,
																				Copper		Other
							Cerro						Indonesia			Molybdenum		Rod &		Smelting		& Elimi-			FCX
	Morenci		Other		Total		Verde		Other		Total		Mining			Mines		Refining		& Refining		nations			Total
Year Ended December 31, 2019
Revenues:
Unaffiliated customers	$	143	$	224	$	367	$	2,576	$	499	$	3,075	$	2,713	a	$	—	$	4,457	$	2,063	$	1,727	b	$	14,402
Intersegment	1,864		2,155		4,019		313		—		313		58			344		26		5		(4,765)			—
Production and delivery	1,376		1,943		3,319		1,852		474		2,326		2,055		c	299		4,475		1,971		(2,911)			11,534
Depreciation, depletion and amortization	171		178		349		406		68		474		406			62		9		28		84			1,412
Metals inventory adjustments	1		29		30		2		—		2		5			50		—		—		92			179
Selling, general and administrative expenses	2		2		4		8		—		8		125			—		—		20		237			394
Mining exploration and research expenses	—		2		2		—		—		—		—			—		—		—		102			104
Environmental obligations and shutdown costs	1		—		1		—		—		—		—			—		—		—		104			105
Net gain on sales of assets	—		—		—		—		—		—		—			—		—		—		(417)		d	(417)
Operating income (loss)	456		225		681		621		(43)		578		180			(67)		(1)		49		(329)			1,091
Interest expense, net	3		1		4		114		—		114		82		c	—		—		22		398			620
Provision for (benefit from) income taxes	—		—		—		250		(11)		239		167		c	—		—		5		99		e	510
Total assets at December 31, 2019	2,880		5,109		7,989		8,612		1,676		10,288		16,345			1,798		193		761		3,435			40,809
Capital expenditures	231		646		877		232		24		256		1,369			19		5		34		92			2,652

a.Includes charges totaling $155 million associated with an unfavorable Indonesia Supreme Court ruling related to PT-FI export duties. Refer to Note 12 for further discussion.

b.Includes revenues from FCX’s molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America and South America copper mines.

c.Includes net charges totaling $28 million in production and delivery costs for an adjustment to the settlement of the historical surface water tax matters with the local regional tax authority in Papua, Indonesia, and $78 million in interest expense and $103 million of tax charges in provision for income taxes associated with PT-FI’s historical contested tax disputes. Refer to Note 12 for further discussion.

d.Includes net gains totaling $343 million associated with the sale of FCX’s interest in the lower zone of the Timok exploration project and $59 million for the sale of a portion of Freeport Cobalt. Refer to Note 2 for further discussion.

e.Includes tax charges totaling $53 million associated with the sale of FCX’s interest in the lower zone of the Timok exploration project and $49 million primarily to adjust deferred taxes on historical balance sheet items in accordance with tax accounting principles.