Kathleen Quirk - Executive Vice President & Chief Financial Officer Jim Moffett - Chairman of the Board Richard Adkerson - President & Chief Executive Officer

David Gagliano - Credit Suisse Michael Gambardella - JP Morgan Sal Tharani - Goldman Sachs Anthony Rizzuto - Dahlman Rose Mark Liinamaa - Morgan Stanley David Lipschitz - CLFA Kuni Chen - Merrill Lynch Brian MacArthur - UBS Securities Jorge Beristain - Deutsche Bank Charles Bradford - Affiliated Research John Tumazos - John Tumazos Very Independent Research Thomas Shaw - Stifel Nicolaus Dave Katz - JP Morgan Brett Levy - Jeffries & Co. Ben Elias - Sterne, Agee

Thank you and good morning everyone. Welcome to the Freeport-McMoRan Copper & Gold third quarter 2009 earnings conference call.

Our earnings announcement was released earlier this morning and a copy of the press release is available on our website at www.fcx.com. Our conference call today is being broadcast live on the internet and anyone may listen to the call by accessing the webcast link on our internet home page.

We have several slides to supplement our comment this is morning. We’ll be referring to the slides during the call.

They’re also accessible using the webcast link on our www.fcx.com website home page. In addition to analysts and investors the financial press is also invited to listen to today’s call and a replay of the call will be available by accessing the webcast link on our home page later today.

Before we begin today’s comments I’d like to remind everyone that today’s press release and certain of our comments on the call include forward-looking statements. Please refer to the cautionary language included in our press release, the slide presentation and to the risk factors described in our SEC filings.

On the call today are Jim Moffett, Chairman of the board, Richard Adkerson, President and Chief Executive Officer. We also have Red Conger with us today as well as Mark Johnson and Dave Thornton.

I’ll start by briefly summarizing in our financial results and then turn the call over to Richard to be referring to the slide presentation materials and after that we will open the call for the questions. Today FCX reported third quarter 2009 net income attributable to common stock of $925 million, $2.07 per share compared with $523 million or $1.31 per share for the third quarter of 2008.

For the nine months period ended September 30, 2009, FCX reported net income of $1.6 billion, $3.70 per share compared with $2.6 billion or $6.20 per share for the nine months 2008 period. Our third quarter copper sales totaled 1 billion pounds.

That was similar to last year’s third quarter, but higher than our July 2009 estimate of 910 million pounds as we had access to the high grade section of Grasberg during the period. Our gold sales were up 706,000 ounces or significantly higher than last year’s third quarter of 307,000 ounces and our July 2009 estimate of 550,000 ounces reflected accelerated mining of a high grade section at Grasberg.

Our molybdenum sales during the quarter of 16 million pounds were lower than last year’s level of 19 million pounds, but slightly better than our July 2000 estimate of 15 million pounds. Our recorded copper prices for the quarter average 2.75 per pound that was lower than last year’s third quarter, which averaged 3.14 per pound.

Our gold prices averaged $987 per ounce during the third quarter of 2009 and that compared with $869 per ounce in the year ago period. Our molybdenum realizations were 1395 per pound that was about 57% lower than last year’s 32 per pound level in third quarter of 2008.

As you will see from the press release our results reflect strong performance in all of our operation and continued successful execution of our plans, which we will talk more about in the slides. Consolidated unit, net cash costs which exclude Tenke Fungurume operations which are currently in start up average $0.50 per pound in the third quarter of 2009, substantially lower than last year’s level of $1.29 per pound.

Strong cash flows were generated in the third quarter totaling $2 billion at brought the year-to-date number to $2.9 billion. Capital expenditures during the period totaled $244 million bringing the year-to-date total to $1.1 billion.

We ended the quarter with debt total debt of $6.6 billion and consolidated cash of $2.3 billion. We took steps during the quarter to repay debt through yesterday.

We had repaid total of $638 million in debt including $340 million of redemption of our 6 and 7/8% notes and open market purchase open of our 8.25% and 8.375% senior notes. We also called for redemption our 5.5% convertible preferred stock during the quarter, and that was converted into 17.9 million common shares.

At the end of September, we had 430 million common shares outstanding and assuming conversion of our 6.3/4% Mandatory Convertible Preferred Stock, which is mandatorily convertible in May of 2010, we would have between 469 million and 477 million common shares outstanding. We also announced today that our Board has reinstated an annual cash dividend on our common of $0.60 per share that would be $0.15 per quarter.

Now, I’d like to turn the call over to Richard, who will refer to the slide material.

Thanks Kathleen and good morning everyone. We’ve all livered through a very interesting this year.

I just thinking back to our call a year ago, we had been several weeks into the process of starting the changes to our business that this results for this quarter reflect tremendous uncertainties facing us because of the real desperate situation in the world’s financing industry a year ago. We knew we had changes, but at this time last year we didn’t know exactly what those changes we’re going to has to be.

We have reported a good quarter in the third quarter of 2008, and now to look at these results for the third quarter of 2009, a year ago we wouldn’t have expected them to have expected them to advance so much stronger than they were a year ago. We still have some uncertainties in our business, but we’ve shown we can adjust to changing economic conditions, and we’re tremendously optimistic about the future of Freeport-McMoRan Copper & Gold as we look forward because of the assets that we have our ability to manage those assets and the positive outlook for the markets that we operate into some real key numbers to focus in on are simply the level of earnings that the $2 billion of operating cash flows we generated in the quarter with only $240 plus million of capital expenditures is very strong performance.

That’s really all stated on slide four, where we show some results. Reducing three by-product credit costs by over 30% year-on-year is a significant accomplishment.

When with you look at the work that our team, where congress team did in North America and South America, where we set some very aggressive plans to change our cost structure and adjust our production profile and our capital spending and the team really executed that in South America, but particularly important in North America where our costs were approaching $2 a pound in the third quarter of 2008, to now this positive result. I’m lived in the business, which was just beginning the significant downturn and lived in prices a year ago, Dave Thornton and his team did an excellent job in adjusting the primary molybdenum business supported by our by-product business to meet these changes and then the great Grasberg mine, and Mark Johnson and his team with the ability to have access to the highest grade section of that mine during this time.

So we generate such strong copper volumes, but also particularly such strong gold volumes at that time of positive gold prices all adds up to a great operating performance. Even based on our estimates as recently as those at the end of the second quarter, we had 10% more copper and 28% more gold and 7% molybdenum.

So volumes were good, cost management has been good, plus the fact that from a mine sequencing standpoint, we were at a high grade section of Grasberg mine and that occurs periodically, the times we have to mine lower grade sections, but the good news is when we had that opportunity to us, our guys took full advantage of it and that added up to the strong performance. Kathleen talked about the cost structure on page five.

There you can see what it is by geographic area. As I mentioned North America, which had unit costs of net unit costs of one pound and costs before credits of $1.22 reflects a really remarkable change from a year ago and of course Indonesia benefited by the strong gold prices and strong gold production particularly the production volumes at the large credit, which resulted in us having a $0.50 a pound overall.

You can see our sales mix, are by regions we have a spread between North America, South America, Indonesia with a very significant gold production from Indonesia. Markets today of course driven by China, China is having record imports.

There’s a story out today about the confidence of Chinese Government expressing about its economy, no question some of those imports went into restocking into inventory builds, but underlying that is a very strong internal Chinese economy, which going into the year was a matter of concern because of weakness in the exports and concerns about the real estate markets. Today we are seeing that the internal economy is really trumping those concerns as automobile production in consumer spending infrastructure spending on item that are consuming commodities really are driving that economy and in the face of weak demand for copper and molybdenum in the U.S., Europe and Japan we see this relatively strong market, which in those economy even though the demand is weak, inventories are extraordinarily low.

So recovery in the developed world’s economy is going to lead to the need for consumers to buy product and when you add the becoming recovery we don’t predict when that might be on top of a world of strong demand from China and the rest of the developing world and match that with the continuing problem that the industry is having in term of finding new products to invest in and having operational labor issues and other factors affecting supplies from the aging existing mines is what gives us such a tremendously positive outlook for the markets, which Freeport-McMoRan Copper & Gold operates in. Page seven shows, where we are in terms of our outlook with our existing plans.

We are taking some steps today to invest in some projects that we had deferred. We will talk about those in a few minutes, but we are not undertaking a large scale change to the strategy that we put in place at the outside of 2009 to reflect the conditions and this plan shows that based on those operating plans that will be looking for having copper sales in 2010 in roughly the same levels where we have today will have strong gold year at Grasberg effective by mining sequence will be a strong in terms of gold sales and our next year as it was this year.

Still roughly 2 million ounces is a strong year for us and our molybdenum plans will continue to constrain our production and sales to match the market’s needs for the product. Page eight gives the outlook for the fourth quarter.

This is again reflecting our mine plans. We have successfully Grasberg which historically we have been able to do, when we are in the high grade section of taking our short term operating plans and optimizing and because of grades at the core of the Grasberg mine are so high, some relatively small changes in terms of accessing more volumes translates into large volumes of copper and gold.

So we continue to do that. It is something that is just part of an optimization, not a change in our long term plans or long term plans are built to maximize MPV for the ore body and to maintain geotechnical safety for the pit and will continue to override what we do simply by taking advantage of having access to, high grade or, we are able to add additional volumes.

We’ll continue to try to do that in the fourth quarter. This is our outlook, but you should take that into account thinking about where we’ll be as we move forward.

Add all that together and page nine shows, what our outlook now would be for our, our cost structure for the full year of 2009, very positive again just couldn’t be more pleased with seeing this outlook at the end of the third quarter based on where we were going into the start of 2009, and to have a consolidated unit net cash cost of $0.60 a pound with copper prices being where they are today results in our company being very profitable and very cash flow positive. Exploration continues to be the major feature of our company.

It is really Natural Resource Company in the large part, but for us, because of the assets within our portfolio, and the ability to add reserve, resources, reserves and ultimately development cost from those projects, is something that points to a very positive long term future for us. We reduced our expenditures for exploration this year.

We were roughly $250 million for ‘08. Our budget for this year is $75 million.

We continue to see opportunities that provide for some incremental spending. We had a lot of data that we generated in 2007 and 2008 from an extensive amount of core drilling, and our team is analyzing that data, and folding it in to our mine plans our future mine plans.

We’ll continue to have the ability to add reserves and we’re developing plans for what we want to do long term in terms of doing a core drilling and exploration analysis or ore bodies really focused on our existing producing mines where we have the ability to add reserves and add future expansions, in a much more straightforward way than you do faced with Brownfield development, Greenfield development in the world today with all of the challenges, in terms of community acceptance of mines The model that we show every year based on the outlook for our cash flows is shown on Page 11. We show it over a range of prices and then on page 12 for analysis purposes, we showed sensitivities to our model based on different prices so that you can look at it, but roughly today is copper price, we’re looking at approximately $6.5 billion of 2010 projected model, I’ll say modeled EBITDA, and $4.5 billion of operating cash flows and you’ll see we’ll have relative low capital expenditures as we go forward.

Prices are higher. We are very leveraged to commodity prices.

Each $0.10 change in the copper price affects our operating cash flow numbers by $260 million. So, $0.20 is over $500 million of operating cash flows to those numbers and copper prices are volatile.

The near term outlook for prices is one in which you could develop scenarios for weaker prices or stronger prices. We’re going to be prepared to operate in whatever scenario develops, but this gives you an outlook for just what our company do in this environment.

Page 13 shows the current capital expenditure outlook. We’re now in our annual cycle of developing our plans for 2010.

So we’re looking at all of this and they’re likely to change. For 2009, we’re now looking at capital expenditures of $1.4 billion which is consistent with what we’ve been saying throughout the year, roughly half of the spending level we had in 2008, we have added a couple of projects that are mentioned that would increase the current outlook for 2010 to $1.4 billion, but that is subject to our continuing analysis of where we are going.

These projects include a couple of things that are mentioned on page 14 at the old historical mining district of Miami-Globe, just east of Phoenix here, which was a key for mining for many years, we had significant reclamation of activities ongoing from historical mining activities. We’ve had plan to mine material in connection with the reclamation activities we deferred that, we’re reinstituting that.

Originally, we thought it would cost $100 million, but because we have excess equipment because of the adjustments we made to our Arizona operations and to scale back high cost incremental pounds. We now with do this project for a much less $40 million and it will give us some copper while we’ll advance our reclamation activities and our large mine in Peru, the Cerro Verde mine, where we have the opportunity in the long term plans to have major expansions.

We’re continuing to drill the resource there and we have the information available to us that would justify a major expansion. We are going to go forward with optimization programs spinning about $50 million to increase the mill rate there and add $30 million per year of incremental copper at a very low 30 million pounds of incremental copper at a very low cash cost.

Both of these projects have extraordinarily high rates of return. El Abra, our major mine in Chile, we are in the final stages of mining the oxide of ore body that was available to us.

We had a project called Sulfolix that we have worked on for it. Sometimes to look at how we would approach to development of a very large and growing sulfide ore opportunity.

We had originally plan to start that in 2009. We deferred it for a year, and have been in the process of thinking about what to do going forward and we’ve now made the decision to proceed with the Sulfolix project.

This is a very positive brown field expansion mine like by ten years providing significant copper production. We’ll have $450 million of capital to be spent over the next three years, and of the $600 million total project.

Since the tough Dodge transaction, the drilling data that we’ve gotten from El Abra has really been very encouraging and beyond this project we’re looking at potential further expansions perhaps partnering operations with nearby mines to develop the very large sulfide ore body through a mill opportunity. At Grasberg, we’ve continued in 2009 under our constrained capital continue to invest in the underground ore bodies, which we’ve now completed the expansion of the DOZ mine to 80,000 tons per day.

That’s one of the worlds, if not the world’s largest single block caving underground mine. They’re in the shadow of the big Grasberg open pit, but it is a very large profitable efficient operation.

We are investing in a smaller high grade mine called the big hexagon and in the Grasberg block cave we’re continuing to do what’s needed to develop that ore body, so that when the Grasberg open pits depletes, which we’re projecting around 2015 and we’ll continue to evaluate that. We’ll be able to immediately go into operation with the block caving operations for the very large extension of the existing ore body that were now mining at the surface to mine that in a very large block caving operation underground.

We’re very comfortable with our technical ability to do that based on our 20 plus years experience, 25 years experience of mining of underground and then we are also completing the feasibility study to mine the very large reserves that we have. We have established adjacent and underneath the DOZ mine, the deep DOZ mine and that will be available to us to startup as a DOZ mine ramps down.

This is a continuation of that block cave mining that we begin really in the early 1980s as we just go deeper and identifying the ore body and completing the development. All of these in the context of industry that has challenges in finding attractive economic investment opportunities are very highly attractive because it large volume long life very low cost.

Tenke Fungurume again very pleased with what our construction group and our operating team has been able to accomplish in a very difficult environment because of its location in central Africa. The absence of infrastructure in these challenges of doing business in a place where infrastructure deteriorated in the mining industry had really dried up.

We began construction there early in 2008 and in roughly a 15 month time period we had completed the basic plant and had begun to produce copper our first copper came out in March and during the third quarter. We produced 54 million pounds of copper.

The construction activities for the mine and the copper processing facilities, cobalt facilities and the SO2 plant are now complete, by late in the third quarter we had reach design capacity for the copper production and we are continuing to ramp up they were start of this is for the SO2 plant, which has big impact on cobalt production. So we are actually operating moving product to market and selling it we have started a feasibility study and which we will commence.

We’re going to planning for talked with engineering firms to evaluate our second phase of this project. Its move an optimization effort which will require low amounts of capital and but it would give us the ability with very little capital to expand capacity by roughly 50%.

This is on slide 18, the largest investment of any kind in the history of democratic republic of come go with total investments today’s for this initial project approaching $2 billion. Our partner recently hosted an analyst’s visit to the site and analyst we went there were able to see really a world class project in terms of its operating design and its construction.

We built this project using the same standards that we would apply anywhere in the world. We have developed significant infrastructure, set the stage for future expansions, we are investing in social and community problems and in terms of the country, this project provides significant employment for a country that really needs employment opportunities for businesses by local contractors, significant taxes royalties and dividend payments through the government’s participation.

We have paid a lot of taxes to date even though we haven’t had production roughly just under $150 million. We have made significant transfer payments to Japanese estate-owned companies.

So, it is from the standpoint of the government, if you look at this contract in relation to contracts around the world, this is a contract that is very favorable with respect to the DRC as country they get just over 50% of the total economics of this project through taxes royalties and dividend. We have been participating in a review of our contractor as all of the contracts in the country have been reviewed.

There have been, there has been publicity about positions that Jack Mines has taken and certain representatives of government’s try to increase those benefits. We are working very cooperatively with the government to be responsive to issues they raise and we will continue to do so.

We are encouraged by comments that a number of people in the government are making about seeing the benefits and the importance of this project and the countries perspective and are working to get this matter resolved although it is not resolved as we speak today. Kathleen talked about our balance sheet and looking back, we have took some steps that have been very positive in setting us up move from a financial position and liquidity standpoint to deal with what we had to deal with this past year.

The equity raise that we did immediately after combining with Phelps Dodge in March 2007, the use of the cash that we generated when commodity prices were higher to reduce debt, and now that we’re generating excess cash we’re continuing to improve our balance sheet. Today it was $6.6 billion of gross debt and $2.3 billion of cash and a maturity schedule as shown on page 20 that has just minuscule amounts of required debt repayments through 2014.

Our company is in a very strong position. We recently through today have made $638 million of debt reductions through calling one issue of notes and retiring roughly $300 million in open market purchases.

We also took steps to call in the money preferred stock convertible security that was issued several months ago in connection with our acquisition of shares at Rio Tinto owned and converted that preferred stock into common stock, and increased our cash flows by not having to continue to pay the preferred stock dividends. We also have on our balance sheet, the mandatorily convertible preferred stock that we issued in 2007 that will mature in May of 2010, and that will automatically go into common stock again eliminating the preferred dividend for that issue.

So, we’ve got a strong balance sheet, strong liquidity position. We’ve shown that we can manage our cost structure in a very aggressive and positive way, we have very attractive near term and longer term growth opportunities, which we will expand as we continue our exploration activity.

With the cash that we’re generating, we will continue to look for opportunities to further reduce debt. Today we have announced our Board has authorized a reinstatement of a common dividend initially at $0.60 per share annually.

Our company has a long tradition of returning cash to shareholders in the form of dividends and share buybacks, and we will be continuing to review our opportunities as we go forward. That’s a summary of the positive situation that we’re in today.

Operator, we’d like to open the line for questions.

I was wondering if you could just share your thoughts with regards to the timing of ramping back up at some of the other U.S. assets, such as Morenci.

That’s something we began plans for it as we were curtailing operations. The decisions we made about curtailments were made and we were going to that process this time a year ago of looking at alternatives and not only thinking about what we could do to reduce in the near term, the high cost incremental pounds, but what will be the consequence of that in terms ramping up, because we were confident at some point we would do that.

We’re continuing to review those plans now. We are likely to make some changes in the near term, but to have a full scale return to maximum production is going to be contingent on our seeing a clear evidence of recovery of copper demand in the U.S.

and Europe and we haven’t seen that yet. Same could be said for our molybdenum business.

It’s going to be a situation that’s available to us, but we will act when the time is right when the market needs those commodities.

As a follow-up, what’s this informant that the assets that shutdowns, they shutdown, scale down? On the mine site and delivery cost, how should we be thinking about that number beyond Q4 i.e., is that 1.15 per pound sustainable into 2010?

It ends on input prices, about 25% of our cost company wide are energy cost. So the price of oil has risen some with the price copper.

So that will have an input, but every time we go through one of these things and we’ve all went through several down cycles during the course of our carriers. The learn things about your operations and you learn how to manage things and as you ramp up.

We’re going to be able to sustain some cost efficiencies that we’ve learned through this process. Our safety statistics are much better now than they have been this the past because we have on average a much more experienced workforce, and we continually try to improve the safety programs, but there are things you learn going through a time like we did this past year, and we’re going to be able to hold on to those.

So for purposes of your modeling I would suggest you look at the elements of our cost and come up with your own estimates about input costs, but the basic cost structure should be sustainable.

I have a question on one of your supplemental slides, Slide number 29, which shows the copper equivalent cross section, the mining sequence for the fourth quarter, and to me I don’t know just, eye balling it looks like in the fourth quarter, you’re certainly looks like primarily in the high grade part of the core at the Grasberg mine. Is there potential for you to exceed the third quarter copper output and the fourth quarter?

I think it would be overly optimistic to think that we could exceed the third quarter just based on the third quarter was in such a high grade section. This is just a cartoon type schematic, but you can see from that, that we had on average greater degree of access in the third quarter than the fourth quarter.

What we have the opportunity to do is perhaps, I guess we have done in the last couple of quarters and historically improve on our outlook, but to be able to get to that level in the third quarter is overly optimistic.

Then last question regarding Tenke, I know you’ve had a lot of cutoff date with the government. The Government has put out and negotiations come and go.

I think the last one was a couple of Monday’s ago, but can you give us an update on those negotiations?

There’s really not much to say, Mike, other than that we’re continuing those discussions. This thing has been going on now there for two and a half years.

We had a process earlier in the year, with the special commission that we have made a lot of progress with and it appeared that this was coming to a close. There was in effect a new process started in early August, that we have been participating with involving government officials in Gecamines and those discussions continue.

From our standpoint, our position has been consistent in that we have a contract that was negotiated on visible fashion in 2003 to 2005. That contract is binding under Congolese law.

It has international arbitration provisions associated with it, in the event there’s a dispute. We are operating under that contract.

We’re not getting a new contract approved, but it’s a re-visitation review of our existing contract. So we’ve listened very carefully and we want to be cooperative and a good partner of the government.

We’ve offered to do some things differently without changing the underlying contracts, and this is more or less a continuation of the same sort of discussions we’ve been having for a very long time now.

Those three employees were acquitted a couple of weeks ago, right for at least?

That was a separate issue, that had to do with a reported incident of corruption by a government official who was convicted recently of embezzling money out of a government bank account that we were paying some fees for temporary workers into and in connection with the government’s investigation of that, they did arrest three of our employees and held a trial and those employees were acquitted in that trial. We of course are doing our own investigation of these issues.

We take it all very seriously. There was never any credible evidence that we have found or that was provided at this trial about any wrong doings for our employees and we of course thrilled when the acquit I’ll came down and they were released from being entrained.

Mike I want to go back and let Mark Johnson fill in on my comments about where we are in our mine plant at Grasberg. I think it be interesting to everyone.

Yes. In the South area and the area we were able to accelerate mining in the third quarter, that area is we have got about 10 million tons left in the pit bottom and as we complete that mining at seven south, which will be done about mid year next year, the 8 East deposit or 8 East push back that you see on the process.

Begins to take over and right now 8 East is providing more than 50% of the ore and we will, as the seven south wind down, 8 East will continue to access better grades in 2010 and that will be the majority of our metal for 2010.

That’s, this is something Mike I know you forward for years and for those of you who followed Freeport ever since the development the Grasberg and as the mine from towards this is a very large open pit mine, almost three kilometers across in the kilometer deep. With the high grade at the very core bottom of the pit our volumes are going to be affected at any point in time, it is just where we are in mine sequencing.

It is not a question of grades changing and so forth. Actually the grades, the ore body are being very consistent with the models that we set, that we have established through all of our thousands of all the course that we have drilled and the volumes just vary quarter-to- quarter year-by-year about where we are in mine plan.

Just wanted to get some color on your cash or use of cash flow, you have suddenly a large chunk of cash in hand and if we look at your expansion projects and the dividends reinstatement. You still left with significant cash and understanding what would be the next step of the use of cash over the next 6 months or 12 months.

It will be a combined program of looking for potential opportunities in the marketplace the to reduce debt. We would like to reduce our debt.

We are going to do that we don’t feel like we have to do it. We will only do it if the market opportunity is there to do it economic basis.

We are going through the process right now looking at our capital plans, assessing the marketplace and when the opportunity’s right we look forward to the time of investing capital in our business because those are great returns, we don’t to do that too quickly but we are so going to be prepared to do that, and then we will do a continuous basis with our board to opportunities return back to shareholders.

Another thing on Tenke, where you are looking into optimization and increasing the capacity, can you give us a timeframe what you think its going to take to achieve that and do you is that infrastructure available to bring that copper cobalt out if you when you achieve that?

It is stages, I mean the first stage is a relatively low cost straight forward opportunity to expand production by 50% and we are going to kick off the feasibility study with that but it is, we’ll report more to you on that as we go forward, but it is relatively low capital requirement. There will be, the next stage would be an opportunity to do a major expansion of the of the oxide ore and resources there, but that would require more capital and more then, ultimately, the future of this project is going to be driven by the sulfide ore and there’s a layer of mix oxide sulfide ore that is very high graded be part of the plan and that stage of dealing with the sulfide ore that it will require amounts of additional infrastructure, particularly from a transportation standpoint and we’re talking with the government now about restoring rental capacity.

There’ll be power investment, but everything we’ve done so far has been done with a view that we will ultimately invest to grow this project to be a world class ore body, but it will be done in stages and particularly as we look at the sulfide and mixed ore opportunity. We still have to do core drilling and exploration analysis in metallurgical work and development planning, but that’s the stage that will require significantly greater infrastructure than what we have today.

I’ve a couple of questions my first question is a strategic question. Does it make any sense to consider becoming more aggressive in hedging imports like energy, and I am not only thinking about going through the futures markets, but does it make sense to own energy sources with the company now throwing off every substantial levels of cash and then I have one more question too.

We continually look at opportunities and strategic views along those lines. Philosophically, we see that there is a correlation between our input cost for energy and some of our other input cost in the price of copper.

So that when copper prices weakened, we benefited by the weakening of energy cost and other input cost, and by the same token as prices rise because those are a fraction of what our revenues offer copper. We benefit, even though those input costs.

Philosophically, we are not a hedging company we don’t see ourselves as traders and we really see ourselves as an opportunity for investors to get exposed to these commodities markets in an unhedged position. Investors have the opportunity of sales day hedge, of course, we basically have historically you had a philosophy of not hedging...

It even though at times obviously, you can maybe attain some energy sources that might be lower costs just to provide even better margins for you over the cycle to keep more of them in effect.

Tony if you have hindsight, you can do that, but if we had obtained an energy source, 15 months ago, when the, when the prices were so high in hindsight that would have been the wrong time to do it. So, it’s easy to look back and say if we had done X and Y at certain times, it would be good, but we’ve been very successful over the years of approaching this thing on an un-hedged basis.

The other question I have for you is in regards to the Grasberg and in thinking about the transition to full underground mining in 2015, for r modeling purposes, how should we think about your total production there, and also how is the site production delivery cost, how is that likely to change?

Well, the transition is going to take a period of time. We can’t begin the block cave until the pit is depleted.

We can do development activities, get prepared to, but the actual commencement of the caving operations will be at the time the pit depletes. So there’ll be a period of time where there will be a ramp up, we’ve always had this valley approach during those early years.

We’re taking some steps through what we’re doing with the DOZ mine, what we’re doing with Big Gossan, what we’re going to be doing with stock borrowing material to have offset those. The cost for the underground era is really again going to be a function of energy costs.

We’ve been fit in on the ground and that we don’t have to move waste rocks like we do above ground. We don’t have the kind of big haul truck fleet and electric shovel fleet that we have above ground.

The cost structure is going to be very attractive. It is very attractive right now for our DOZ mine.

Labor is an issue, we’re doing a strategic training right now to prepare ourselves for that, but let me just say that is going to be depending on input cost of very attractive operation and over the life of the mine it will be something to say less than $0.40 per pound and that at a $800 goal.

Going into the downturn, you had outlined a plan that’s to grow into the mid $4 million pounds of copper production range. Now, respect you’re taking cautious few and have outlined some growth plans now, but based on your asset review, you’ve done in the meantime, would you be able to say is that still a number for a production rate in a positive comparable environment, that you would feel comfortable with?

Thanks.

Absolutely, I mean the one thing we haven’t done is lost any resource opportunity what we’ve had. Among other reasons, but one of the reasons we won’t fall, I think it was, we had obligations under our contract and we want to preserve that opportunity, but all the curtailments that we made our other operations or places where we owned the rights to the resources and we can step up and expand them.

So the 5 billion pounds plus of outlook that we had before is certainly there for us. I mean requires investment, require sometime to get there and with our exploration opportunities we can see opportunities to grow beyond that level.

So we haven’t lost any of those opportunities.

If things really look positive would that be a realistic number to say in 2012, 2013. How much longer?

Let’s say, if we were to un-ramp everything and go forward by the end of this year. I’m not saying that we will.

I think it’s probably unlikely that we will see at that point then. It would be a two year period from that going forward.

So it’s two plus years.

Question to you on the China situation, I just don’t want to talk a lot of off inventory copper. Can you comment on that, do you agree with like the numbers of million tons and that?

Is that something that worries you?

David, it is what it is. I mean I wouldn’t say at worries just as we encourage that the growth on the Chinese economy and they’re spending own infrastructure and in fact the economy hasn’t run into any of the really significant bumps in the road, they were predict in earlier this year.

We don’t have any particular inside into the inventory levels. We are expanding our commercial activities there, historically they’ve been a really small part of our business, but we are expanding our sales of copper concentrates into China.

We’re selling cobalt into China and selling some lived there. So in terms of what we are seeing from the commercial contacts, we have their people aren’t over concerned about this level.

The inventory is a big concern that we hear from our Chinese customer is. The availability for copper, what their needs are going to be long term and so they are projecting tremendous amounts of resources needs in the world where those supplies are very limited.

Just a question follow-up on, you talked about the uses of cash reducing debt and assessing the market things like that. Are acquisitions on table?

It’s hard for us. Everything is always on the table.

Its hard for us as we look at opportunities to find opportunities that compete with our own internally investment opportunities and I use this, I like this comment many times if you buy something, you end up having to pay for that resource to the current owner. With our resource opportunities that we can invest in our own we have the resources and we can invest in them and capture all of that value for our shareholders.

So, if the right opportunity came to us and you can be sure that bankers are always in our offices and we have a group this monitoring everything that goes on around the world. The right opportunities there, we are in position to take advantage of it, but its very hard for the opportunities that we see to compete with what we have available to us internally.

Let me just use that is an opportunity to talk about a couple of thing and we appreciate very much the congratulations of the quarter that Richard and the operating team have had, but this multi fact that operations, but we have multi continents of granite production and exploration opportunities, but as far as acquisition are concerned, the question gets asked every time. We made the acquisition and put Freeport-McMoran and sales nice together.

What we basically did was to set that stage for use development program to delineate the assets of both companies and more particularly the company, because we had a very active program that was delineating the bottom, because of our underground operations it was upcoming in 2010. In many of the mine that were in the oxide ore was the focus of the opportunity I know everybody this been following us note of the definition of oxide versus sulfide ore, but for those that having got that the picture yet imagine having a bunch of picture sitting around and they some of the piece was ripen that was exposed to the oxygen, and the whole rest of the piece being there unrecognized.

That’s what it oxide ore it was a very good decision was to develop on a process of leaching so that is ripen part of the piece that was oxide could be taken in a dollar a rest for a price environment in the copper business. So all of that was investigated in the drilling was done through the outline in the oxide ore.

In many cases and we just talked about the elaborate situation. The good part of the piece that was considered not exposed to the erosion was never delineated to any extent, but we did in the merger and Freeport-McMoRan enter of thus was expand a lot of money about $300 million inflation program.

That was really delineation program and what we have confirmed is that the sulfide part of the ore in all of these mines has tremendous new potential in the all way from newest or oldest mines, newest being the great mine in the Congo and really once again all it being evaluate there was oxide for the ore body because of the leaching ability as opposed to have into go through complete refinery process in the smelter. So all of these sulfide ore bodies you can look at as been a second part of the acquisition.

We required the ore which was the same side situation the oxide ore some information was variable of the sulfide ore. With that increased exploration opportunity, exploration/delineation as we tell you before our called brown fields, exploration opportunities that are done in the existing mines, but we have existing infrastructure as so far superior to going out and trying to buy new assets when you do a great merger which Richard and team they’ve not only done the merger, but have continued to take the opportunity to combine the resources both natural resources.

The human resources and end up with it a model for production that gives us again a multinational, multi-metal company that has copper, gold, cobalt and obviously with gold being over a $1,000 of ounce with the amount of gold we’ve produced at the Grasberg, which lowered our international production cost. As Rich said, our acquisition of the Phelps Dodge three, fourth, merger set the tone and therefore a new acquisition for us were very hard to find.

This new acquisition was put in these two comments I guess so good. These got years to run as far as define the total potential.

So hope that the prosperity within, why acquisition although always something that we will consider are just not as a tragedy as developing our own resources, as result of the [Inaudible].

Just a follow-up on Tenke, can you just remind me, whether any obligations under the current contract to get a certain product level beyond the 250 million per ounce let’s say over the next couple of years?

Yes, we obligations with some time requirements to start feasibility studies. I think we’re required to develop the resources if they’re economically feasible and there was a timeframe that required us to initiate feasibility studies, once we’ve reached commercial production for the first phase of the development.

I mean, this is consistent what we want to do. So we don’t see it as any kind of owner’s requirement, but there are timing requirements for initiating studies into CESS feasibility for resource development.

When that’s typical with concession agreements around the world and we’re in line with doing that.

The feasibility study is expected to take roughly, how long you think?

I’m not sure, six months or so, we are just in the process of beginning to contact engineering firms to work with this on and we expect to commence that study at the end of the year. We are aggressive if want to develop this, we always point to the development of the Grasberg that we have been operating at that site from 1972 to 1988 when the discovery holes were drilled.

From drilling, the initial core holes into the Grasberg, 10 years later we had spent almost $4 billion and it gone from an operation that had less than 20.000 tons to-date through its mill to one that was operating at 240,000 tons per day. So, in terms of aggressiveness and development is a company that committed to that and with given collaboration with the government, their ability to operate development structure and what we believe is going to be very attractive markets within that.

Coming timeframe, we’re going to be very aggressive about our development there.

Last question, can you just talk about how the IMF could potentially play a role in helping to hiring up the negotiation process with the government here?

The IMF is not directly involved in our project. IMF and World Bank and other international institutions are working with the government in terms of its overall financial situation and as Heller/Clinton recently visited the DRC in connection with her trip to Africa and she was encouraging the DRC and other African countries to take steps to encourage private foreign investments.

I think all of that, world wants to see Africa and the DRC succeed and success requires significant profit investment by veritable companies and that certainly what we bring to the DRC.

I just want to see and gets more color on elaborate now that we are back on the table, I just have a bit three issues. First of all will there be any fallout in production is there timing now set up that you go ahead once center enough just maintain the study state sort of around 300 million pound plus.

I guess my second part…

The answer Brian is yes a little, we should be able to sequence the copper building a new leech pad and with the ability to sequence spending we are to be able to maintain relatively stable that was production.

Then a I assume the second part of the capital up from 450 to 600 front in 2050 not just continue to build additional pads in the future. That doesn’t get any more production or is it because the great falls offer something what’s the etc 150 of pass through12.

Just to sustain the production level for the life of the ore body.

I assume none of these relates to what you sort of talk about a little bit on the call earlier what I would call elaborate to that there is more ore outside of what you seeing right now which might lead to a larger operations with that a potential partner going forward never the talk about today’s just standalone on the 300 million, 10 year extension.

That’s exactly right and as it one of the things that are floor back to Jim last comment, you go back to the time we combine the companies. We knew about the project we knew that was build into our plans of having to have a longer lot mine life of senior of volumes at attracted cost for elaborate.

What we have learned since then, through our exploration activities it there is much great opportunity now than we saw 2.5 year ago.

I guess that pads the question why just don’t ramped up bigger right now given, is that just a cautious view it sounds like you have the data at southern right that capital can straight view given you cash flows. What is it that just holds it up there?

We look at that, I mean I was one thing we annualize just weather not we go straight to the mill opportunity, from do in business, in the desert challenges are power and water and so we are continuing to annualize both way of a meaning those challenges efficiently, but what our analysis showed us is considering the timing for going forward with the mill development. It was economic for us to go forward with the shuffle x project, in terms of the maximizing MPV.

So, we are this doesn’t eliminate the mill, but if we goes straight to mill we would not had the benefits near term of the economic that have been shuffle x.

Just on another comment made earlier about Miami of capital cost came down from a 140 million, because you said can basically use equipment from other shut down mines. I see we are going to add to do that is that anyway really slowly down and bring back any of other production in U.S.

southwest I guess David was asking about or is that just a, purely an economic timing trade off that we can move the trucks over to Miami it will be keeper there then we opening the other stuff the U.S. southwest or is the reclamation requirement of makes you go to back Miami and do that first.

There was reclamation that we are going to have to do any event. So, that’s the context that we are dealing with before when we were buying trucks to support our mine planned other mines that do the Miami project was we are going out and mind the equipment.

Now we have that equivalent that’s available to us. Is not going to show anything down it just rather having in other equivalent sitting I don’t we are going to put it to work near term.

Then with be fair to that that assume that the Miami cash cost at Miami would lower still though then the other U.S. southwest operation.

Yes, it’s going to in the dollar range and again that’s because it’s mining for reclamation. So I mean it’s taking the cost that we were also some of the material we are going to anyway.

So now we just going to capture some copper out of it.

My question was really more about the 2010 guidance for gold. I think that’s really a linchpin to perhaps why the street may have a lower year-over-year outlook for you guys and if you could just kind of quantify the certainty with the projections for a Grasberg.

Last two quarters you were annualizing our output at a rate of over 3 million ounces for your company and next year you’re quoting closer to a range of less than 2 million. So that 1 million ounce falloff in gold.

It’s a big headwind and I was just wondering given that you already for two sequential quarters sort of beat your own internal guidance, if you’re not feeling a little bit more optimistic about your baselines for 2010 guidance at this point, in other words that they have upside from here?

This goes back to, that is comments that Mark Johnson had. We’re transitioning from one mine phase to seven that 80 phase, which is had a high elevation were great or lower and then we’ll be lowering 80 stand the higher grades overtime.

So that’s our mine plan and we will be following that mine plan. So we know that mine plan based on what our model shows for the grades and the sections that we’re planning to mine.

This is our current best outlook and so it’s not, you can’t compare an annual run rate for what we’ve done in the last two quarter, was what we will do in any future quarter, because we’re just simply mining in a section of the mine that has different grades. It’s still extraordinary high grades.

This is the heard of this great ore body that we’ve been mining now. I’ll go back and say that as we then on a day-to-day basis execute these mine plans.

Mark works with our team and his guys and then they made decisions to say here some high grade ore that we can access and if we can do that in owe that’s not disrupted to our long term mine and that acts within our parameters of geotechnical safety, we do that. So particularly, I just go back and say, this particularly moving the high grade sections of the mine and in 2010 we will be, not as high grade as we were in the third quarter, but a very high grade section in the mine.

Those decisions to access small volumes of ore can translate into larger volumes of copper and gold, because the great content of that ore is so high. So I think that we will have the likely opportunities to improve on 2010.

We can guarantee that, but history has shown that we’ve had ability to do that, but it won’t be going back to quality of the ore that we mine in the third quarter. We don’t see that as headwinds and no analyst have to come up with quarterly estimates and annual estimates.

We will look at this as a long term ore body that’s going to provide really strong volumes at very low cost and strong cash flows, and that’s was we operate this things for.

Second question I had with just regarding the baseline dividend that you declared for 2010 at $0.60. Historically, you had the flexibility when you’re paying that quarterly run rate, I think in the third quarter of last you’re paying around $0.50, to just on any given quarter start to bump up that rate.

Should we take the $0.60 baseline for 2010 has at this point or do you see upside flexibility as you get into 2010. Again getting back to ideas access free cash flow, would allow you in terms of flexibility of the change that policy sort of intra-year?

Absolutely, I mean our board reviews financial policy every quarter. As you noted in 2008, we actually increased the dividend.

We have done that a couple of times since we merged with Phelps Dodge. In the past, we paid some special dividends.

During the market conditions we have a authorized stock valid program. So the extent of markets are strong, we are funding our capital expenditures.

We’re taking advantage of opportunities to reduce debt. Excess cash, the priority wouldn’t be looking to return to shareholders.

Richard, let just make a comment about the projection of our goal, when you’re looking at the open pit as you just brought in your question. The symmetry of the open pit, we have no latitude because, we have to keep that high wall from being in a position to have any kind of a slump.

As we go underground, if you look at past 2015 and get into this big golden horse as we call it the bottom of the pit, which might enter on that’s in the open pit, because of the symmetry of the open pit. Once we get underground and we’re brought, we don’t have a high wall to deal with.

So you have a lot more focus of being able to stay in the house right over. So 2015, used a sound like a long way off, as we sit here is about the approach, 2010 it becomes ominous and as Richard just said, the more focused stability we don’t have, we have all that the hall out of the open pit and don’t have the symmetry of the high wall to deal with, going underground, it can become a very efficient operation as you’re literally sticking to the core of the ore body, or you can just take the high grade ore and not have to take the waste on the high walls, as we’ve done from the beginning of the pit.

A question about Tenke, it seems to have operated at about 85% of capacity in the third quarter. When are you going to start including in the financials?

You’re right about the copper productions, we’re still in stronger mode with SO2 plant and with cobalt and the cobalt component is an important factor in looking at our unit cost. So we will start including it in our overall the cost presentation.

It is in our financials, we are making full disclosure about this. You can see what the unit cost are right now, so we’re not is not like there’s not anything being disclosed.

Your question I think were much of the fact when we’re going to include it in our overall cost numbers? Once we reach design capacity in 2010, we will include it in our overall numbers.

Again as a segment, as we do with North America and South America, Indonesia and then Africa. All the data is there, so you can see the unit cost we’re referring right now.

No, I appreciate that and I have seen it. In the sales profile that you’ve given going out 2010 and beyond I’m assuming it’s in there, is that correct?

Yes, that’s correct with the copper, yes.

We’ll actually don’t do cobalt it doesn’t matter.

Cobalt doesn’t matter, Chuck.

I mean, you are not forecasting out the cobalt.

That’s correct and the cobalt is going to be important because, as we develop this mime, we will be a very large cobalt producer in relation to a very small global marketplace and our market routine working right now and how we commercially deal with that market is being a very large producer.

Will start showing a series of charts on the future cobalt sales, as you do with copper, gold and moly?

As we do with everything, we’ll have full disclosure on it.

I have questions about the acid plant at Safford, which I believe was started and maybe a $100 million of $250 million budget had been spent and the climax project were something like $200 million of $500 million had been spent. I guess, I have a strong enthusiasm for U.S.

projects that were already permitted partly built, nobody shoots out throws your people in jail, easier places to operate maybe. How long can you hold those projects idle until you might be required to take a reserve against the investments?

What is the outlook for restarting those projects? Also this morning moly mines in Australia had a $700 million financing for moly from a Chinese.

As you delay other companies these opportunity and is that way and your decision making?

We’ll go ask Red, to talk about the sulfur burner at Safford. Dave is here, to talk about Climax.

We owned that Climax land and fee. So we don’t have any time requirements of that went to start.

We won’t start at project. It is the world’s best development project in the molybdenum business.

You’re right, we’ve split money. We have a lot of construction work done.

We have mills in place. We really need two summers’ construction seasons to get that project.

Now wanted about $350 million and we would have the design capacity for 30 million pounds annually of cobalt, a very attractive cost structure and we’re going to go follow with that. We are the world’s largest producer of molybdenum.

We have great positions in all the marketplaces for that and as the market goes forward, we’ve constrain production at Henderson, our standalone mine. We have Climax ready to go and we’re going to protect our market share.

We’re going to be profitable and we’re going to that at a right time. We agree with you, it’s a great asset and we looking forward and go forward out there.

The sulfur burn area that Safford, was affected by the sulfur gas in market, which is so dramatically with this past year. Red, do you want to talk about that?

Yes, thanks Richard. The sulfur burner project was stopped both conserve cash and take advantage of the good asset fundamentals that we found quickly earlier this year in the Southwest.

We are continuing to reevaluate, when it would be appropriate to reinitiate that investment as we say. It’s permitted and ready to go and we’re looking for proper timing and opportunity on that.

It will safe on logistics, so give us good long term prices going forward of cost.

In terms of the accounting question Richard, how long would Safford asset plan or the Climax project to be able sit idle before you are various like challenges the carrying value, two years, four year, six years?

It’s just not an issue. The resource is so good and the outlooks for the commodities are, so strong that this is not even close.

So it’s not an issue.

I was hoping, you could talk a little bit more about experience so far with transportation, how the DRC and possibly maybe characterize some of your options to expand transport capacity with new production at Tenke? I think if you started any negotiation with entities outside of the DRC, regarding rail routes or other more transportation?

Currently, we’re using the same route from South America that we used to bring in the massive amounts of materials. We brought the site during construction and so we’re shipping copper and cobalt by truck down through from Tenke Fungurume to Angola and then own to Johannesburg by truck.

The transit time is taking 20 to 25 days. We are talking with purchase of the product, they’re looking at taking to product from [Inaudible] so there’s alternatives.

We are having discussions right now more about restoring rail was in the DRC, that’s were the infrastructure is so low, actually Kathleen has given me numbers to show that, we’re ramping less than 20 days transit. So all of that’s working well.

It’s a long truck haul, as a lot of trucks, but they’re contractors and again as something that we’ve had experience in working home for sometime because of the inbound material from construction. We are engaged in discussions with government, with some other parties about restoring real options within the DRC and ultimately the most favorable option we need to connect with railroads in Angola, that which was in traditional, which is Angola is restoring it’s rail system now, so all of those things or items were actively working.

You guys have estimated $75 million exploration expense for 2009, but with the $73 million that you’ve spent year-to-date that implies just $2 million in expenditure import in ‘09, is that correct and should we expect such a little levels in 2010 as well?

No, you shouldn’t expect that, $75 million was a general budget. I think that number you’re talking about includes research.

So actually the budgets you’re comparing that too was $75 million for exploration and $20 million for research. So we’re spending about on rate with our budget.

We want to spend money on exploration. Our exploration has come out with ideas for that makes sense we’re not constrained them budget numbers, because it add such significant value.

A year ago as we were developing our plans, we were in a cash constrained mode that was going into the year. We didn’t know where we were going to be at this time of the year and we had a lot of that on exploration team to continue their work.

We didn’t take off any emphasis on exploration is just we decided to curtail core drilling in some field work and continue to do analysis to see where we were going.

What’s your understanding that you guys have a large amount of internal projects you do anticipate exploration expenses increasing for 2010, correct?

Yes.

Then the second question would be, with regard to the open market debt repurchases, previously you guys had mentioned that perhaps would be nice to be investment grade, it was not driving any of your behavior. Is that still the case?

Right, we’re able to operate effectively in the financing markets and I think we have a lot of credit ability within the credit markets with what we’ve done in the past and we don’t see that is being constrained. We are investment grade rating rated both S&P and Fitch.

We believe we qualified with Moody’s and we’ll continue talk some about that, but we don’t see our rating is being any sort of constrained strategically before we wanted to.

So the debt repurchases is clearly are driven by a desire to increase the flexibility of the company as well as to lower to a lower than annual interest expense?

Exactly.

A similar question David, I understood when obviously there were really yield to your paper and how attractive the returns might be? You’ve talk to a lot of different much higher return opportunities, why would debt buybacks be the best strategy here because, at this point, you’re capturing maybe a 6% to 7% return?

Brett, compare that was a return we have for this plenty amount of cash we have on our balance sheet. As we look forward, we’re going to be continuing to generate cash.

So we have the resource, we’re not constrained by any capital for capital spending or for exploration spending by cash. So we’ve got ample cash resources and when we have the opportunities of comparing the interest cost with virtually no amounts we get for cash, it just makes sense do it and in the long run as we always have, we want to have a strong balance sheet.

So it’s just minimizing negative spread on the cash?

Minimizing negative strade, improving the balance sheet.

I have question regarding CapEx. I notice in the past said 2000 CapEx is estimated to be about a billion and I went today that is now taking up to be about 1.4 billion.

I was wondering if there was any granularity in the CapEx way that’s going to be I know you made to strategic shift in, over the last 12 months in moving to high or grade lower cost mines and that really worked for you and the rather than CapEx its really on indication of way you think plus going to be in the long term. So I take it as positive that you taking CapEx.

I was wondering if you could go through the split between equipment purchases and sort of repair and spare parts and also I think about nine months ago you cancel from shovels from joy global I was wondering if some of those equipment purchases that would delayed third quarter, fourth quarter and last year now, coming back on with the of that a commodity pricing and better demand outlook.

Let me say we did cover in our slides where this capital spending is going to be directed and that’s with the startup of the Miami operation and the optimization project it severity in their slides on that. In addition we always are evaluating our maintenance capital spending in their some increase in that.

We are going through a budget process right now and which we will updates spending. We expect overtime for the reason you said is their capital spending raising, we have an reinstated the major expansion projects that were previously engaged in and so there is not huge amount of new equipment orders in this expansion, but the reacting of equipment in the engineering cost and the execution cost of forward doing but their we have not yet began to make major and you expansions of equipment purchases in fact we still have a substantial I don’t equipment for that we are looking to put back to work.

Do you think it’s more likely that you put that back to work on move it in the case of Miami?

We have been, I can advantages of moving we shift trucks from the U.S. to Indonesia we reallocated trucks from South America.

We shift truck to South America for plans and so earlier the year we talk a good bit about how we were dealing with our inventory management in our supply chain management and again I tell my add to guys they really have been able to do this in a very effective way in its been one other reason just after reduce our unit cost by more than 30%.

All right. On behalf of our team, we thank everyone’s interest and appreciate your attention in this call and you continuing to evolve our company.