How would you assess Freeport’s recent performance in North America?

Overall performance improved significantly compared to 2023. Operational efficiencies and productivity remain a priority, as does the ‘Leach the Last Drop’ initiative, which supports incremental copper growth. Maintenance and reliability of equipment saw meaningful improvement. Freeport continues to face challenges with input costs and inflationary pressures, though these have softened slightly. The company made significant progress addressing labor challenges, having successfully onboarded, hired and integrated a substantial number of employees. We remain focused on strengthening the fundamentals of our business and continuing to build on these improvements. Can you detail recent advancements at Bagdad?

Freeport made significant progress in 2023 and 2024 on the studies for the Bagdad expansion. We are conducting final engineering to refine costs and prepare for a decision to advance the project. We began work on a new tailings facility necessary for the expansion.

Another key development at Bagdad is the implementation of autonomous haulage. We expect the first autonomous trucks to begin operation in the first quarter of 2025, with the goal to achieve full autonomy by the end of 2025. This positions Bagdad to better support the expansion while addressing labor challenges tied to its remote location. What is Freeport’s approach to developing Lone Star?

While further drilling could reveal additional resources, we have identified enough to move forward with a pre-feasibility study. Rather than wait for full delineation, we decided to use the existing data to evaluate the potential for a milling operation and its integration with the current crush and leach operations. The pre-feasibility study is targeted for completion in 2025. Although Lone Star is a low-grade deposit, typical of many Freeport assets, we excel in operating in this space. Its location in the well-established Safford district, where we already have strong community and stakeholder relationships, provides a substantial advantage. How has the ‘Leach to the Last Drop’ Initiative progressed?

We reached an annualized run rate of over 200 million lb of copper and have clear visibility to an additional 200 million lb. Our goal is 800 million lb/y. Initially, we focused on fundamental leaching improvements, targeting opportunities in both historic and current stockpiles. Key efforts included retaining heat within stockpiles, as increased heat directly boosts recovery rates. We leveraged data analytics and AI models to identify areas that were insufficiently leached, allowing us to apply targeted solutions for additional recovery. We are exploring new additives to enhance recoveries, drawing insights from AI, our technology center, and even pharmaceutical modeling techniques used to identify potential treatments. This work will ramp-up in 2025, complementing the practices that already deliver incremental copper. What is the value add of innovation in the current capital environment?

Projects like Bagdad, Lone Star and El Abra involve substantial capital investments (US$3.5 to US$4 billion for Bagdad and up to US$8 billion for El Abra), while ‘Leach to the Last Drop’ could deliver 400 million lb of copper for under US$1 billion. This makes it the most economic growth project in our portfolio. It reduces greenhouse gas emissions and water consumption, making it a win on multiple fronts.

The entire industry faces declining grades and increasing haul distances, requiring more material movement to produce the same amount of copper. These challenges drive up costs, demanding greater productivity and efficiency. We must spend more to produce less. We must not only achieve the productivities and efficiencies we achieved in the past but do even better. To achieve this, we must innovate and rethink our approach to mining. Data analytics, AI, and other technologies play a critical role. How is Freeport advancing the energy transition?

The best way for Freeport to support the green energy transition is by optimizing operations to produce as much copper as possible. Freeport supplies 60% of US copper consumption and 9% globally. Our priority is to focus on what we can control—maximizing production in the most efficient way possible. We are accelerating leaching initiatives to deliver incremental copper more quickly and advancing the Bagdad 2X concentrator project to enable a decision within the next 12 to 18 months. In addition, we are progressing the Lone Star pre-feasibility study toward feasibility. Achieving these goals over the next 12 to 24 months will position our North America operations for long-term success.