Edgar Filing: PLAINS EXPLORATION & PRODUCTION CO

425

FCX to Acquire PXP and MMR in

Transactions Totaling $20 Billion,

Creating a Premier U.S. Based

Natural Resource Company

December 5, 2012

FILED BY FREEPORT-MCMORAN COPPER & GOLD INC.

PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933

SUBJECT COMPANY: PLAINS EXPLORATION & PRODUCTION COMPANY

COMMISSION FILE NO. 001-31470

CONNECTING THE FUTURE

Cautionary Statement

Regarding Forward-Looking Statements

Cautionary Statement

Regarding Forward-Looking Statements

This press release contains forward-looking statements concerning the proposed transaction, its financial and business impact,

management’s beliefs and objectives with respect thereto, and management’s current expectations for future operating and

financial performance, based on assumptions currently believed to be valid. Forward-looking statements are all statements

other than statements of historical facts. The words “anticipates,”

“may,”

“can,”

“plans,”

“believes,”

“estimates,”

“expects,”

“projects,”

“intends,”

“likely,”

“will,”

“should,”

“to be,”

and any similar expressions or other words of similar meaning are

intended to identify those assertions as forward-looking statements. It is uncertain whether the events anticipated will

transpire, or if they do occur what impact they will have on the

results of operations and financial condition of FCX, MMR, PXP

or of the combined company. These forward-looking statements involve significant risks and uncertainties that could cause

actual results to differ materially from those anticipated, including but not limited to the ability of the parties to satisfy the

conditions precedent and consummate either or both of the proposed transactions, the timing of consummation of either or

both of the proposed transactions, the ability of the parties to

secure regulatory approvals in a timely manner or on the terms

desired or anticipated, the ability of FCX to integrate the acquired operations, the ability to implement the anticipated business

plans following closing and achieve anticipated benefits and savings, and the ability to realize opportunities for growth. Other

important economic, political, regulatory, legal, technological,

competitive and other uncertainties are identified in the

documents filed with the Securities and Exchange Commission (the

“SEC”) by FCX, MMR and PXP from time to time, including

their respective Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. The

forward-looking statements including in this press release are made only

as of the date hereof. Neither FCX, MMR nor PXP

undertakes any obligation to update the forward-looking statements included in this press release to reflect subsequent

events or circumstances.

Additional Information about the

Proposed Transactions and Where to Find It

Additional Information about the

Proposed Transactions and Where to Find It

PXP Transaction

In connection with the proposed transaction, FCX intends to file with the SEC a registration statement on Form S-4 that will include a proxy statement of PXP that also

constitutes a prospectus of FCX. FCX and PXP also plan to file other relevant documents with the SEC regarding the proposed transaction. INVESTORS ARE URGED TO READ

THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF AND WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN

IMPORTANT INFORMATION. You may obtain a free copy of the proxy statement/prospectus (if and when it becomes available) and other relevant documents filed by FCX and

PXP with the SEC at the SEC’s website at www.sec.gov. You may also obtain these documents by contacting FCX’s Investor Relations department at (602) 366-8400, or via

e-mail at IR@fmi.com; or by contacting PXP’s Investor Relations department at (713) 579-6291, or via email at investor@pxp.com.

FCX and PXP and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of

proxies in respect of the proposed transaction. Information about FCX’s directors and executive officers is available in FCX’s proxy statement dated April 27, 2012, for its 2012

Annual Meeting of Stockholders. Information about PXP’s directors and executive officers is available in PXP’s proxy statement dated April 13, 2012, for its 2012 Annual

Meeting of Stockholders. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or

otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the merger when they become available.

Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of

these documents from FCX or PXP using the sources indicated above.

This document shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such

offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except

by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.

MMR Transaction

In connection with the proposed transaction, the royalty trust formed in connection with the transaction will file with the SEC a registration statement on Form S-4 that will

include a proxy statement of MMR that also constitutes a prospectus of the royalty trust. FCX, the royalty trust and MMR also plan to file other relevant documents with the SEC

regarding the proposed transaction. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF

AND WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. You may obtain a free copy of the proxy statement/prospectus (if and

when it becomes available) and other relevant documents filed by FCX, the royalty trust and PXP with the SEC at the SEC’s website at www.sec.gov. You may also obtain these

documents by contacting FCX’s Investor Relations department at (602) 366-8400, or via e-mail at IR@fmi.com; or by contacting MMR’s Investor Relations department at (504)

582-4000, or via email at IR@fmi.com.

FCX and MMR and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of

proxies in respect of the proposed transaction. Information about FCX’s directors and executive officers is available in FCX’s proxy statement dated April 27, 2012, for its 2012

Annual Meeting of Stockholders. Information about MMR’s directors and executive officers is available in MMR’s proxy statement dated April 27, 2012, for its 2012 Annual

Meeting of Stockholders. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or

otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the merger when they become available.

Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of

these documents from FCX or MMR using the sources indicated above.

This document shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such

offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made

except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.

Transaction Highlights

Creates A Premier U.S. Based Natural Resource Company

Adds High Quality U.S. Oil & Gas Assets to World-Class Mining Portfolio

Asset Quality Consistent with Characteristics Sought in Mining

Business Large, Long Life, Low Cost, Expandable

Enhances Exploration Leverage with Significant Value Potential

Complementary Commodity Exposure to Long-Term Global Growth Trends

Combined Asset Portfolio Expands Reinvestment Opportunities to Drive

Future Growth

Transaction Summary

Price

FCX to acquire PXP for: 0.6531 shares of

FCX common stock and $25.00 in cash,

equivalent to total consideration of

$50.00 per PXP share based on FCX

closing price on December 4, 2012

FCX to acquire MMR for: $14.75 cash

plus 1.15 Ultra-Deep Royalty Trust

Units per MMR share

Premium

39% to PXP’s closing price on

December 4, 2012

Cash portion represents 74% to MMR’s

closing price on December 4, 2012

Structure

50% stock / 50% cash

$3.4 billion cash; 91 million new FCX

common shares

100% cash plus Ultra-Deep Royalty

Trust Units

(2)

Transaction Value

$17.2 billion (includes assumed debt)

$2.4 billion (includes assumed debt)

Key Conditions

Shareholders’

approval

Customary regulatory approvals and

conditions

Shareholders’

approval

Customary regulatory approvals and

conditions

Timing

Closing expected in 2Q 2013

FCX Pro Forma

Enterprise Value: $60 billion

1,041 million shares outstanding

Total Debt of $20.0 billion

(1) Prior to the transaction, FCX and PXP collectively own 36% of MMR

(2) Creation of Royalty Trust provides MMR shareholders 5% ORRI for continued participation in potential shallow water, ultra-deep GOM success

PXP

MMR

(1)

$88

$64

$60

$50

$42

$38

$30

$27

$25

$50

$75

$100

$125

$150

XOM

CVX

COP

OXY

FCX

APC

APA

EOG

CHK

MRO

($Bn)

Pro forma FCX will be the 5

largest U.S. domiciled natural resource

company and the 5

largest global mining company by enterprise value

Source: Company filings, FactSet. Market data as of 12/4/2012.

* Includes U.S.-based E&P, mining and coal companies, including integrated companies. Midstream and downstream companies are excluded.

** Excludes precious metal companies

$402

$198

$125

$124

$111

$60

$50

$32

$24

$21

$20

$25

$50

$75

$100

$125

$150

BHP

GLEN/

XTA

RIO

VALE

FCX

AAL

SCCO

TCK

ANTO

($Bn)

$204

Top US Domiciled Resource Companies*

Top Global Mining Companies**

A Premier U.S. Based

Natural Resource Company

A Premier U.S. Based

Natural Resource Company

Benefits of the Transactions

Geographic & Commodity Diversification –

2013e EBITDA

(1)

North

America

North

America

Indonesia

31%

29%

South

America

29%

Africa

11%

Mining

100%

Mining

100%

Oil & Gas

26%

Oil & Gas

26%

Mining

74%

Mining

74%

North

America

North

America

Indonesia

23%

48%

South

America

21%

Africa

Existing

(1)

Based

pricing

assumptions

$3.50/lb

Cu,

$1,500/oz

Au,

$12/lb

Mo,

$100/bbl

Oil

(Brent)

and

$4.50/MMbtu

natural

gas.

estimate.

See

Cautionary

Statement.

Pro forma

High Quality U.S. Resource Base Provides Exposure to Energy Market with

Attractive Fundamentals

~85% of Acquired Revenues from Oil

(1)

Favorable Entry Point to Source of Low Cost, Long-term Gas Supply

Significant Exploration Upside

Strong Margins and Cash Flows to Fund Growth

O&G EBITDA Margins of ~75%

(1)

Diversification Expands Portfolio of Attractive Investment Opportunities

Access to Low-cost Debt Financing

Enhanced Commodity Exposure to

Long-term Global Growth Trends

Emerging Market Growth and Urbanization Will Continue to Drive Commodity Demand

Global

Energy

Consumption

Expected

Grow

>30%

2035

(1)

Global

Refined

Copper

Consumption

Expected

Grow

~60%

2025

(2)

(1)

International Energy Administration

(2)

Brook Hunt

Favorable Supply/Demand Fundamentals Expected to

Remain Supportive of Future Oil and Copper Prices

WTI

Copper

WTI Oil Price v. Copper Price

Note: monthly 30-day averages

dated 11/30/12

$30

$50

$70

$90

$110

$1.00

$2.00

$3.00

$4.00

$5.00

History & Corporate Relationships

FCX & MMR Spun out of Parent Company Freeport-McMoRan Inc.

in Mid-90’s

Parent had Long History in Natural Resources Business Including

Minerals, Oil & Gas, Fertilizer

Management has Significant Minerals and Oil & Gas Experience

FCX Invested in MMR in 2010 Through Preferred Stock Transaction

PXP Became MMR’s Largest Shareholder in 2010 through an Asset

Swap Transaction

FCX and PXP Currently Own 36% of MMR

Proven Management Team

Complementary Management Teams with Substantial Experience and Track

Record of Success in Mining and Oil & Gas Exploration and Development

Global Industry Leading Capabilities:

Operational Excellence

Major Project Development

Technological Innovation

Exploration/Engineering

Prudent Environmental Management

History of Prudent Financial Management and Execution in Varying

Market Environments

Established Track Record of Capital Discipline and

Focus on Value Creation for Shareholders

Phelps Dodge Case Study

$17.6

$7.2

$3.5

$10

$15

$20

Rapid Delevering

Consolidated Cash

$3.4

$1.6

$3.7

Net Debt/(Cash)

$14.2

$5.6

$(0.2)

At Time of PD

Acquisition in

March 2007

9/30/12

($ in bns)

Debt

Based on estimated proven & probable reserve additions as of 12/31/11 before production.

December

2007

Highly Successful

Transformational Transaction

Asset & Geographic

Diversification

Significant Reserve Additions

•

+46 billion lbs Cu*

Developed World-Class Copper

Portfolio

•

Recognized Industry Leader

•

Strong Current Production with

Substantial Growth Profile

•

Large Resource Position

Successful Integration

Effective Management During

2008/09 Economic Crisis

Acquired

Assets

Acquired Asset Overview

Onshore

•

Established California Oil Production

•

Growing Oil Production Profile in Eagle Ford

•

Large Natural Gas Resource Position in Haynesville

Offshore

•

Quality Deepwater Portfolio

•

Established California Oil Production

72% of 2013e Production from Oil with Premium Market Pricing

(77% Including Liquids)

Industry Leader in Emerging Shallow Water Ultra-Deep, Sub Salt Play

Results to Date Indicate Potential for Long-Term, Low-Cost Source of

Natural Gas

Geologic/Technology Risks have been Significantly Reduced

Leading Acreage Position on Leases with Primary Structures

Net Unrisked Resource Potential in Excess of 50 Tcfe

PXP

–

Strong

Current

Cash

Flows

with

Growth

MMR

–

“Franchise”

Highly

Prospective

Emerging

Resource

Trend

e = estimate. See Cautionary Statement.

High Quality U.S. Oil & Gas Portfolio

(1)

PXP Reserves as of 12/31/11 except for reserves purchased in deepwater acquisitions which are as of 9/30/12; MMR reserves are mid-year 2012 pro

forma for 2H12 divestitures.

e = estimate. See Cautionary Statement.

575 MMBOE

California

38%

California

38%

Eagle Ford

Haynesville

22%

Haynesville

22%

Other

Deepwater

GOM

25%

Deepwater

GOM

25%

GOM

Shelf

Proved Reserves

(1)

California

23%

California

23%

Eagle

Ford

21%

Eagle

Ford

21%

Haynesville

Other

175 MBOE/d

Deepwater

GOM

33%

Deepwater

GOM

33%

2013e Production by Region

GOM

Shelf

11%

GOM

Shelf

11%

Oil

66%

Oil

66%

Gas

28%

Gas

28%

2013e Production Mix

NGLs

Natural Gas

Oil

Oil & Gas Reserves & Resources

(MMBOE)

PXP

(1)

MMR

(2)

Total

% Oil/Liquids

PXP

(1)

MMR

(2)

Total

% Oil/Liquids

Proved Reserves

538

575

64%

Probable Reserves

337

348

44%

Possible

Reserves

646

658

29%

Total

1,521

1,581

45%

Near-term Resource Potential

1,353

4,981

6,334

Total Potential

~3,800

~50 Tcfe

3Q12 Daily Production Rate (Mboe/d)

~160

(3)

~182

(1)

Reserves as of 12/31/11 except for reserves purchased in deepwater acquisition which are as of 9/30/12

(2)

Mid-year 2012 reserves pro forma for 2H12 divestitures; exploration potential includes ~30 Tcfe from near-term onshore/offshore Ultra-Deep prospects

(3)

Includes ~60 Mboe/d from GOM acquisition which closed on November 30, 2012

Enhanced Exploration Leverage

with Multiple Near-term Catalysts

Enhanced Exploration Leverage

with Multiple Near-term Catalysts

Near-term Net Potential

of 995 MMBOE

•

Phobos (~300 MMBOE)

to Spud in 4Q12

•

On Lease Exploration

from BP: 300+ MMBOE

•

Each 100 MM Barrels =

PV-10 of ~$2.5 Billion

Pre-tax

(1)

3 Wells Drilling

Recent Positive Results on

Lineham Creek Onshore

High Potential Prospect

Inventory

~50 Tcfe of Net Potential,

Including ~30 Tcfe from

Near-term Prospects

Each 2 Tcfe Net = PV-10 of

~$2.5 Billion Pre-tax

(2)

Eagle Ford –

71 MMBOE

Haynesville –

~1 Tcfe

California –

+100 MMBOE

Deepwater GOM

Shallow Water Ultra-Deep

Onshore U.S.

(1)

Based on $100.00/bbl LLS oil

(2)

Based on $4.50/MMbtu natural gas

Pro Forma

Combined

Company

Profile

FCX’s Global Footprint

Copper

Copper/Gold/Silver

Molybdenum

Cobalt

Oil/Natural Gas

Note:

FCX

consolidated

reserves

and

annual

sales;

reserves

December

31,

2011.

Sales

figures

are

based

2013e.

Cu operations: Morenci (85%), Sierrita (100%), Bagdad (100%), Tyrone (100%), Safford (100%), Miami (100%) and Chino (100%); Primary Mo: Henderson (100%) and Climax (100%);

Oil & Gas operations: onshore/offshore CA, Madden, Eagle Ford, Haynesville, GOM shelf & Deepwater

PXP Reserves as of 12/31/11 except for reserves purchased in deepwater acquisitions which are as of 9/30/12; MMR reserves are mid-year 2012 pro forma for 2H12 divestitures

Includes moly sales from South America

Cu operations: Candelaria/Ojos del Salado (80%), Cerro Verde (53.6%) and El Abra (51%)

Major Operations & Development Projects

All major mining assets majority-controlled and operated

e = estimate. See Cautionary Statement.

(a)

Estimated recoverable proven and probable copper reserves as of 12/31/11 using a long-term average copper price of $2.00/lb; 96 billion pounds net to FCX’s interest.

(b)

Estimated

consolidated

contained

copper

resources

12/31/11

using

long-term

copper

price

$2.20/lb.

Mineralized

Material

not

included

reserves

and

will not qualify as reserves until comprehensive engineering studies establish their economic feasibility. Accordingly, no assurance can be given that

the estimated mineralized material will become proven and probable reserves. See Cautionary Statement.

(c)

Includes PXP reserves as of 12/31/11 except for reserves purchased in deepwater acquisitions which are as of 9/30/12 and MMR reserves as of mid-year 2012 pro forma

for 2H12 divestitures. Excludes results from GOM shelf ultra-deep activities.

Combined Reserves and Resources

Reserves

(a)

(recoverable copper)

Reserves

(a)

Mineralized

Material

(b)

at $2.00 Cu price

(billion lbs of copper)

at $2.20 Cu price

Reserves

Mineralized

Material

(b)

(contained copper)

115

billion

lbs

2P Reserves

(c)

Reserves &

Resource Potential

Proved: 575

~7,900

923

(million barrels of oil

equivalents)

Probable: 348

Possible: 658

Near-term

Potential: ~6,300

North

America*

excludes restarts currently in progress; incremental copper per annum

PT-FI’s share, average per annum

excludes restarts currently in progress; incremental copper per annum

PT-FI’s share, average per annum

Highly Attractive Brownfield

Copper Development Projects

Highly Attractive Brownfield

Copper Development Projects

South

America*

Tenke

Fungurume

Grasberg

•

150mm lbs Cu/yr oxide

expansion nearing completion

•

Potential sulfide expansions

•

Morenci Expansion

(225 mm lbs Cu) under way

•

Potential sulfide expansions

(~800 mm lbs Cu)

Mill Expansions

(t/d)

Cerro Verde (360K)

600

$4.4

2016

Morenci (115K)

225

1.4

2014

Tenke (14K)

150

0.9

2013

TOTAL

975

$6.7

Expansion Projects in Progress

Incr. Cu

(mm lbs/yr)

Capital*

($ blns)

Achieve

Full Rates

* excludes capitalized interest

•

Cerro Verde Expansion

(600 mm lbs Cu) under way

•

Potential El Abra Mill

(600 mm lbs Cu)

Underground

development under

way

1.1 bln lbs Cu**

1.4 mm ozs Au**

Copper Sales (billion lbs)

Gold Sales (million ozs)

Diverse Production Profile

with Strong Growth

Diverse Production Profile

with Strong Growth

2012e

2013e

2014e

2015e

1.0

1.4

1.8

2012e

2013e

2014e

2015e

100

2012e

2013e

2014e

2015e

Molybdenum Sales (million lbs)

____________________

Note: Consolidated copper sales include approximately 705 mm lbs in 2012e, 800 mm lbs in 2013e,

* Includes Cerro Verde expansion (2016 full rates) & Morenci mill expansion, targeted for 2014.

e = estimate. See Cautionary Statement.

Includes Projects

Currently

Under Way*

3.6

5.0+

4.5

4.3

100

2012e

2013e

2014e

2015e

Oil & Gas Sales (MMBOE)

____________________

Note:

Consolidated

gold

sales

include

approximately

105k

ozs

2012e,

140k

ozs

2013e,

____________________

Note: 2012e includes sales from GOM acquisition beginning on December 1, 2012. Oil & Gas

Ultra-Deep

Expl./Dev.

Ultra-Deep

Expl./Dev.

180k ozs in 2014e and 175k ozs in 2015e for noncontrolling interest.

sales estimates include approximately 13.3 MMBOE in 2014e, and 22.6 MMBOE in 2015e from

potential success from ultra-deep Shelf exploration and development.

770 mm lbs in 2014e and 875+ mm lbs in 2015e for noncontrolling interest; excludes purchased copper.

Pro Forma

Combined

Company

Financials

2013e

2014e

2015e

$10

$15

$20

$25

$3.00

$3.50

$4.00

FCX Pro forma EBITDA, Cash Flows &

Capital Expenditures

$3.00

$3.50

$4.00

Operating Cash Flow*

EBITDA

CAPEX

Copper Prices

$1,500 Au/$12 Mo/$100 Oil/$4.50 Gas**

Copper Prices

$1,500 Au/$12 Mo/$100 Oil/$4.50 Gas**

* Excludes working capital changes

** See impacts of prices changes for gold, molybdenum, oil and gas on slide 32.

2015/

2016

Avg.

2013/

2014

Avg.

2013/

2014

Avg.

(Brent)

2015/

2016

Avg.

2013/

2014

Avg.

2013/

2014

Avg.

Mining

65%

O&G

35%

O&G

35%

60%

40%

48%

52%

~45%

Increase

~45%

Increase

Focused and Disciplined

Capital Allocation Philosophy

Allocate Capital to

Low Cost, Long-lived,

Expandable Assets

Focus on

Largest

Resources

Ensure

Potential

is Well

Understood

Establish Short,

Medium and Long

Term Potential for

Primary Assets

Quantify Risks

Technical, Political,

Social, Economic,

Market

Rigorous Economic

Analysis Under

Range of Assumptions

Protect Downside,

Leverage to Upside

Prioritize & Rank

Opportunities

Highest

Returns/NPV

per $

Invested

Manageable

Risks

Overall Portfolio

Balance/Strategic Fit

Limit Number of

Projects –

Focused

Management Attention

Repay

Debt

Return Excess Capital to

Shareholders

Maintain Strong Balance Sheet & Credit Profile

Capital Expenditures

(1)

(US$ billions)

Other Mining

Major Mining Projects

Oil & Gas

3.0

1.6

1.4

1.0

2.5

3.0

2.0

3.3

2.9

2013e

2014e

2015e

(1)

Capital expenditure estimates include projects in progress. Project spending will continue to be reviewed and revised subject to market conditions.

(2) Primarily includes Cerro Verde expansion, Morenci mill expansion and Grasberg underground development.

Note: Includes capitalized interest.

e= estimate. See Cautionary Statement.

$7.1

$7.3

$6.3

(2)

Oil & Gas Cash Flows –

Targeted to be Self-funding

Oil & Gas Cash Flows –

Targeted to be Self-funding

$0.0

$1.0

$2.0

$3.0

$4.0

2013e

2014e

2015e

Operating Cash Flow

CAPEX

NOTE: Assumes pricing of $100/bbl Brent crude for oil and $4.50/MMbtu for natural gas

e= estimate. See Cautionary Statement.

(US$ billions)

$16.3

$7.7

$2.0

($3.5)

-$5

$10

$15

$20

Significant Debt Reduction

Year-End Net Debt at Varying Copper Prices

Pro Forma YE 2016e

(US$ billions)

’13-’16 Avg. Copper Price

Net Debt/’13-’16 Avg. EBITDA

$3.00

0.6x

$3.50

0.1x

$4.00

N/A

9/30/12

Pro Forma

Note: Sensitivity assumes $12 Molybdenum, $1,500 Gold, $100 Oil and $4.50 Natural Gas; EBITDA equals operating income plus depreciation, depletion,

and amortization

e= estimate. See Cautionary Statement.

Maintain Strong Balance Sheet & Liquidity Position

Reduce Debt Incurred in Acquisitions Using Substantial Cash Flows

Generated from Combined Business

Invest in Projects with Strong Financial Returns/Capital Discipline

Anticipate Continuing Current Common Stock Dividend Rate:

$1.25/Share per Annum

Board to Review Financial Policy on an Ongoing Basis

Committed to Long-standing Tradition of Maximizing Value for

Shareholders

Financial Policy

Combined Company Highlights

Creates A Premier U.S. Based Natural Resources Producer

World’s Largest Publicly Traded Copper Producer

Significant Producer of Oil, Gold & Molybdenum

Significant Long-term Natural Gas Resources

Strong Margins & Cash Flows

High Quality, Long-lived and Geographically Diverse Assets

Appendix

(1)

Includes ~ 7 MMcfe/d of natural gas

(2)

Includes ~ 4 MBOE/d of NGLs

(3)

Includes ~ 6 MBOE/d of NGLs

2013e Oil & Gas

Operating Estimates

2013e Oil & Gas

Operating Estimates

NOTE: e = estimate. See Cautionary Statement.

Oil

MBOE/D

(1)

California

Haynesville/

Rocky Mtns/Other

127

GOM

Eagle Ford

(2)

(3)

125

2013e Oil & Gas Sales by Region

Operating Cost: $27/bbl

Pricing: Brent Based

Operating Cost: $15/bbl

Pricing: LLS

Operating Cost: $10/bbl

Pricing: LLS/NYMEX

Operating Cost: $1.65/Mcfe

Pricing: NYMEX

Gas

MMcfe/d

Gulf of Mexico Shelf/

Deepwater

Gulf of Mexico Shelf/

Deepwater

California

Eagle Ford

Rocky Mtns. &

Haynesville

Rocky Mtns. &

Haynesville

Copper: -/+ $0.10/lb

$405

$275

Molybdenum: -/+ $1.00/lb

$80

$65

Gold: -/+ $50/ounce

$75

$45

Oil Sales:

(1)

+ $10/bbl

(2)

$340

$265

$10/bbl

(3)

($275)

($280)

Oil

Sales

Net

Diesel

Costs:

(1,4)

+ $10/bbl

$260

$205

$10/bbl

($195)

($220)

Natural Gas:

(5)

+ $1/Mcf

$90

$1/Mcf

($90)

Currencies:

(6)

+/-

10%

$150

$110

Operating

Change

EBITDA

Cash Flow

Sensitivities (US$ millions)

(1)

Oil sales sensitivity calculated using base Brent price assumption of $106/bbl in 2013, $101/bbl in 2014.

(2)

Amounts are net of $73 mm change related to hedging loss in 2013/2014; no hedging impacts will be applicable above $126/bbl because of ceilings in place on 2013 collars.

(3)

Amounts

are

net

$141

changes

hedging

gain;

hedging

impacts

below

$70/bbl

because

limits

place

2013

–

2014

puts

and

collars.

(4)

Amounts are net of $80 mm (EBITDA) and $60 mm (c/f) for FCX stand-alone cost impacts of a $10/bbl change in oil prices.

(5)

Natural

gas

sensitivity

calculated

using

base

NYMEX

price

assumption

$3.93/MMbtu

2013

and

$4.23/MMbtu

2014.

Amounts

net

$38

impact

from

hedging.

(6) U.S. Dollar Exchange Rates: 500 Chilean peso, 9,500 Indonesian rupiah, $1.00 Australian dollar, $1.26 Euro, 2.70 Peruvian Nuevo Sol base case assumption.

Each +10% equals a 10% strengthening of the U.S. dollar; a strengthening of the U.S. dollar against foreign currencies equates to a cost benefit of noted amounts.

NOTE:

Based

2013e/2014e

averages.

Operating

cash

flow

amounts

exclude

working

capital

changes.

estimate.

See

Cautionary

Statement.

2013e/2014e

Oil & Natural Gas Hedging Positions

Oil Indexed to Brent

Swaps

Puts

Collars

15%

Unhedged

Puts

15%

Unhedged

Puts

84k bbls/d

$90 floor

$70 limit

$6.90 ADP

43%

Unhedged

Natural Gas Indexed to Henry Hub

2013

2014

2015

Swaps –

100/d @ $4.09

117k bbls/d*

129k bbls/d*

147k bbls/d*

2013

2014

2015

40k bbls/d

@ $109.23

30k bbls/d

$95 floor

$75 limit

$6.09 ADP

75k bbls/d

$90 floor

$70 limit

$5.74 ADP

5k bbls/d

$100 floor

$80 limit

$7.11 ADP

25k bbls/d

$100 floor

$80 limit

$124 Ceiling

5k bbls/d

$90 floor

$70 limit

$126 Ceiling

13k bbls/d

$100 floor

$80 limit

$6.80 ADP

17k bbls/d

$90 floor

$70 limit

$6.25 ADP

Swaps –

110/d @ $4.27

No Hedges

NOTE: As of October 19, 2012; ADP = average deferred premium.

* Estimated annual production for MMR & PXP. See Cautionary Statement.

Pro Forma Balance Sheet &

Credit Statistics

Pro Forma Balance Sheet &

Credit Statistics

Pro Forma September 30, 2012 Capitalization

(US$ billions)

Amount

Cash and Cash Equivalents

$ 3.7

Revolver

(1)

$ 0.0

FCX New Sr. Unsecured Notes

5.5

FCX

New

(Unsecured)

Term

Loans

–

(Refinance

PXP

Secured

Debt)

4.0

FCX Sr. Unsecured Notes

3.0

FCX Subsidiary Public Debt

0.4

Other Debt

0.2

PXP Existing Sr. Unsecured Notes

6.6

11%

MMR Existing Sr. Unsecured Notes

0.3

Total Debt

$20.0

33%

Market Value of Existing Equity

(2)

$39.8

67%

Total Market Capitalization

$59.8

100%

Total Debt / Market Capitalization

33.5%

2013e Credit Statistics

Debt / EBITDA

(3)

1.7x

EBITDA

(3)

/ Interest

(4)

11.1x

____________________

(1) Revolving Credit Facility commitment of $3.0 billion available to FCX

(2) Based on 1.041 billion pro forma shares outstanding and FCX’s closing stock price of $38.28 on December 4, 2012

(3) Based on 2013e EBITDA of $11.8 billion (Based on pricing assumptions of $3.50/lb Cu, $1,500/oz Au, $12/lb Mo, $100/bbl Oil (Brent) and $4.50/MMbtu natural gas.)

(4) Based on 2013e Interest of $1.1 billion (includes capitalized interest)

e = estimate. See Cautionary Statement.

FCX Pro Forma Debt Maturities 9/30/12

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

2013

2014

2015

2016

2017

2018

2019

2020

2021

Thereafter

$300

$500

$4,500

$400

(US$ millions)

$1,800

$10,600

PXP

6.75%

6.875%

Sr. Notes

New

Term

Loans

Pro Forma Total Debt & Cash at 9/30/12

New Term Loans

$4.0

New Notes

5.5

Public Debt

10.3

Other Debt

0.2

Total Debt

$20.0

Consolidated Cash

$3.7

(US$ billions)

New FCX

Sr. Notes

$200

$1,100

$600

MMR

11.875%

Sr. Notes

FCX

1.4%

Sr. Notes

PXP

10%

Sr. Notes

FCX

2.15%

Sr. Notes

PXP

7.625%

Sr. Notes

PXP

6.125% &

8.625%

Sr. Notes

PXP

6.625%

Sr. Notes

PXP

7.625% &

6.5%

Sr. Notes

FCX

3.55%

Sr. Notes

FCX Sr. Notes

MMR Sr. Notes

PXP Sr. Notes

Other Debt

New FCX Debt

Royalty Trust Terms

5% Gross Royalty Override on MMR's Ultra-Deep Exploration

Portfolio

20-Year Term

•

Non-callable for First 5 Years

•

Callable at FCX’s Option in Years 6-20 at $10 per Unit

Shares Risk/Upside Between FCX and MMR Shareholders

MMR Shareholders Would Receive 1.15 Units per MMR Share

•

Units FCX Would Otherwise Receive on its MMR Convertible Will be

Issued to Other MMR Shareholders as Merger Consideration

Trust Listed for Trading