Ladies and gentlemen, thank you for standing by. Welcome to the Freeport-McMoRan Third Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. I would now like to turn the conference over to Ms. Kathleen Quirk, Executive Vice President and Chief Financial Officer. Please go ahead, ma'am. Kathleen L. Quirk - Chief Financial Officer, Treasurer & Executive VP: Thank you and good morning. Welcome to the Freeport-McMoRan third quarter 2015 earnings conference call. Our results were released earlier this morning, and a copy of the press release and slides for today's call are available on our website at fcx.com. Our conference call today is being broadcast live on the Internet, and anyone may listen to the call by accessing our website homepage and clicking on the webcast link for the conference call. In addition to analysts and investors, the financial press has also been invited to listen to today's call and a replay of the webcast will be available later today on our website. Before we begin our comments, we'd like to remind everyone that today's press release and certain of our comments on the call include forward-looking statements, and actual results may differ materially. We'd like to refer everyone to the cautionary language included in our press release and presentation materials and to the risk factors described in our Form 10-K and subsequent SEC filings. Today on the call, we have Jim Bob Moffett, Richard Adkerson, Jim Flores and several other of our senior members of the team in the room here. I'll just start by briefly summarizing our financial results and then turn the call over to Richard who'll review our recent performance and outlook. As usual, after our remarks, we'll open the call up for questions.…

Our first question will come from the line of Jorge Beristain with Deutsche Bank. Please go ahead.

Good morning, Kathleen and everybody. My question is actually for Kathleen. Could you talk a bit about what the stance is of the credit agencies toward the current commodity environment and obviously, everyone can appreciate your current leverage level. But have you received any kind of language from them that they're starting to get concerned about the protracted nature of your net debt balance? Kathleen L. Quirk - Chief Financial Officer, Treasurer & Executive VP: Well, Jorge, I think you can see the press releases that both S&P and Moody's made during the quarter. They have – their commodities team have updated their outlook for commodities across the board including copper. And they undertook a review of Freeport during the quarter that both agencies affirmed our ratings and we did go to it from a stable outlook to negative. We've been in close contact with S&P, Moody's and Fitch really to walk them through our plans for debt reduction, show them how we get there with our organic business in terms of rising volumes, lower costs and lower CapEx. And so, the expectation is that as we get through 2016, our credit metrics will improve significantly and be within their parameters for our rating. And we're very focused on executing those plans so that our outlook can be moved back to stable. And that's really what they have been looking at in terms of our plans. But they've been running numbers at different commodity prices. Like I said, we've been in close communication. But they do see 2015, as we have signaled all year, as a bridge year, getting to this higher cash flow and free cash flow more importantly in 2016 and 2017. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: And, Jorge.

Yes. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: This is Richard. I think without question, they're giving us credit for what we did in deleveraging after the Phelps Dodge deal and how we managed the crisis in 2008-2009. So, they are looking at what we say we're going to do. Now, it's on us as a management team to show that same degree of discipline in executing our plans as we go forward.

Got it. And sorry, just maybe a technical question. I'm not sure Kathleen or Jim would answer this. But what oil price assumption are you guys using to determine the carrying value of your oil assets, which obviously took another write-down this quarter? But where are we just as a jumping off point if we had to do a further mark-to-market? What are you kind of using as your baseline for oil at this point? James C. Flores - Vice Chairman; President/CEO, Oil & Gas, Freeport-McMoRan, Inc.: Jorge, we're required to use SEC price deck which is a trailing 12 month average. If you use the forward curve, forward curve is actually lower by a few dollars than the SEC price deck. So, you'll see us continue. If oil prices continue to stay in the $40, $45 range, the $50 range, you'll see, in the fourth quarter, you'll see a slight reduction there. But all depends if oil prices stay steady or go up or erode going forward. But we're kind of at – we're at that apex point where we may not totally be there just because of the oil price in the fourth quarter. So far, here in October, has been a few dollars below the SEC price, average price for the last 12 months that we used for that reporting purposes.

Got it. Thanks very much. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: So, Jorge, we used the realized prices in each region we have, but they are referenced off a WTI price of $59 a barrel at the end of the third quarter. So, that's not the exact price we use because we adjust it for what oil is selling for in California and offshore. But the reference price, the WTI price, and we don't have a choice on this. This is the – these unfortunate SEC rules that require us to use this trailing-12 month average and it was $59 WTI for the third quarter.

Got it. But it sounds like, as you're saying, you're basically cycling that out by the fourth quarter. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Well, that all depends. It won't all cycle out because in the fourth quarter we'll use the four quarters in 2015, and in the first quarter, the price was $70 something. So, it takes time for this to cycle through using the 12-month average, that's why I call these rules unfortunate. James C. Flores - Vice Chairman; President/CEO, Oil & Gas, Freeport-McMoRan, Inc.: But at the fourth quarter, we're getting through the – we're getting through a lower average price and if you have a $55 oil price in 2016, for example, we'll be kind of there, versus if it's $45 price in 2016, there'll be some more for reevaluation ahead. Does that kind of help you?

Yes. Thank you.

Your next question comes from the line Brian Yu with Citi. Please go ahead.

Yeah. Thanks and good morning. First question is just on Indonesia. It sounded like the government would make – maybe seeking a little bit higher royalties. Can you speak to that? And then, on the guidance that's built in there for next year, how much of a wage increase is reflected in those numbers? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Thanks, Brian. We agreed last year when we signed a Memorandum of Understanding with the government that allowed us to go forward with restoring exports at the time and also set the stage for further discussions with the government leading to this recent letter. At that point, we agreed to increase the royalties that were in our contract of work to the royalties that were specified in the 2009 mining law. That was a concession we made to meet the government's aspirations. And so, in our discussions with the government now, those are the royalty rates that would be reflected in our extending contract going forward. And they would be fixed. They wouldn't be subject to further changes. So the – like we see here in the United States with this presidential campaign, there'll be a lot of comments politically coming out of Indonesia. But that's the facts of where we are with our royalties and with this recent understanding with the government about how we'll go forward. Kathleen L. Quirk - Chief Financial Officer, Treasurer & Executive VP: And Brian, the second part of your question regarding the wages. We have made assumptions on what we expect the wage negotiations to be concluded at. But it wouldn't be appropriate for us to give that at this point because we're still finalizing those negotiations. But the numbers that you're looking at includes what we expect the results to be in our ongoing discussions, which we're progressing as we speak.

Got it. That's helpful. Maybe the second question is just on the oil and gas with your plans, either a partial IPO or a spin-off, is there a cash dollar amount that we can think about that you would put into those assets under either of those scenarios? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: That's really what we're reviewing now. So – and again that depends on alternatives and marketplace and our view of – we're going to have a view of how to make sure whatever we do is supportive of FCX's financial condition and financial position. At the same time, if we do have a separation, we have to separate the business in a way of where it's sustainable on its own and can trade well. And so that's the trade-offs we're going. But Brian, it's – again, that's subject to this review and we'll be pursuing this aggressively. And further information will come out as we – as our board reaches decisions on it.

Okay. Definitely appreciate that. All right. Thank you. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Thank you.

Your next question comes from the line of David Gagliano with BMO Capital Markets. Please go ahead.

Thanks for taking my questions. I did want to drill in a little bit more on Indonesia. Just the commentary in the press release regarding the longer term, the underground development and potentially pushing some of that out, I was wondering, first of all, if you could give us a bit more color on the thought process there, the timing associated with more visibility on potentially deferring some of that CapEx and when we should hear more definitive commentary. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Okay. Well, the numbers you see today actually reflect some of the work that we're doing about adjusting our longer-term mine plans. Previously, the annual spending on a gross basis for the joint venture was a $1 billion. We've now – annually, average. We've now reduced that to $800 million. And part of that has to do with how we mine and ultimately process ore that contain pyrites. And that includes some of the Grasberg Block Cave ore. And that would in the longer range affect how we do with the Kucing Liar ore body. But altering the mine plans to avoid the bulk of this pyrite ore, we can defer capital spending on the processing facilities and the transport and storage facilities for pyrite. We're developing plans to do that with – so that we don't end up wasting significant amounts of ore. So, it's a timing opportunity that would allow us to then go back and make those investments in mining and processing that ore in the future, and we're continuing to do that. But that's the major factor, Dave, along the lines of what you're talking about. That's how we're dealing with the long-term mine plans at Grasberg.

Okay. All right. Thanks. And then just separately on the strategic review of the energy business, the alternatives for the energy business, I'm wondering if you could give us a feeling for timing, when we should get more visibility on that front as well. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Well, we reconstituted our board two weeks ago. We announced this review. We're starting the process now of coming up with alternatives and how to evaluate it. We need – there is a degree of urgency in dealing with these capital cost. So I'm not in a position right now giving you any red line time dates, but I can tell you, it's a matter of focus, and we are approaching this immediately.

Is it reasonable to say within the next, say six months, we'll get something or is it longer? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Yes. Within that timeframe.

All right, great. Thank you.

Your next question comes from the line of Tony Rizzuto with Cowen and Company. Please go ahead.

Thank you very much. Good morning, all. Kathleen L. Quirk - Chief Financial Officer, Treasurer & Executive VP: Good morning.

I've got a couple of questions here. First one is on Indonesia. It does sounds encouraging that the process is moving forward. Now, assuming you get resolution on the extension of the COW, how can you assure investors that you'll be able to get a fair value with the additional 20% stake in PTFI? There seem to be conflicting reports about the ability to do an IPO, and I was wondering and associated, is that now off the table? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: No, Tony. It's not off the table. Throughout this whole process, our position has been and now the government supports it, it was in the MOU in mid-2014, it's reflected in what the letter says, is that any divestment would be on the basis of fair value. And exactly how we divest depends on how we work with the government on it. The government, the central government itself will have the opportunity to acquire shares, they've had that opportunity in the past and haven't elected to do it, but we will work with them on it. The possibility of sales to stay-on companies is there. The possibility of an IPO is something we've done work on, and we can see some benefits to that to be traded on the Indonesia Exchange. Government officials would – some government officials are very supportive of that. So, all of this process is, again, conditional on getting the final documentation of the extension, and then we're prepared immediately at that point to go forward in working with the government as to exactly how to do that. But the IPO is certainly one of the alternatives that we'll be talking with them about.

Okay. And then I got a question also on oil and gas. And of the $2 billion CapEx, how much is purely sustaining and how much of that number is required to develop and kind of reload inventory with prospects? James C. Flores - Vice Chairman; President/CEO, Oil & Gas, Freeport-McMoRan, Inc.: All right. Tony, look at this way. About $750 million will keep production flat in the Gulf of Mexico and California. So, you're really talking about $2 billion is forecasted and I might have mentioned today that we're trying to work – continue to work with that number. Everything above that would be toward the growth CapEx (58:11) 25% increases.

Okay. James C. Flores - Vice Chairman; President/CEO, Oil & Gas, Freeport-McMoRan, Inc.: And going forward – going forward to 2017, that's kind of $750 million to $1 billion. That's why at $45 and even lower, we can continue to be cash flow neutral once we have this production on, and just defend it by putting on one or two wells a year. When you have 13 good discoveries in your inventory, it's pretty easy to see the visibility there.

Okay. And just – I'm curious what do you think is the most preferable outcome? I mean, a complete spin-off to existing shareholders or what the – obviously, it's a matter of debt allocation and a lot of other factors. But I'm just curious as to management's thinking. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Well, Tony, that's something that's going to be a board decision. And so, for us to come out now and say – we're going to have lots of ideas. The ideas are going to be considered and assessed in terms of creating value for the FCX shareholders. And that's going to be a board deliberation. And all of us have ideas. And we'll present those ideas, do analysis on them. We'll have expert advice on the markets and what's best. And that – then the decision is going to come out. It wouldn't be appropriate at all for us to start speculating on where that's going to go. James C. Flores - Vice Chairman; President/CEO, Oil & Gas, Freeport-McMoRan, Inc.: Tony, where Rich highlighted the board reconstruction, I resigned from the board and so forth. That's so we wanted to give the board maximum flexibility to have as far as separating the oil and gas business if that makes sense. Their advisors advise them and so forth of where the highest and best value of FCX is. That's the path forward. But they have maximum flexibility. There's no sacred path or no prohibited path at this point. So, that's the value for the FCX shareholders, that's the number one goal here.

Okay. And just – thanks for that color. And just a quick one on Sierrita. And I was wondering if the evaluation you're doing now points to a full shut-down there, what impact might this have on your overall unit cash costs? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Well, Sierrita is – at these – it's really such an interesting mine because it's got low grades and big moly content. You don't have to look back many years ago to where it was our lowest cost mine. And now it's our highest cost mine. So, at current levels, unit cost are $1.90 roughly. And so that's why we cut it back and if we could cut it back totally, we're dealing with this water management issue, we would do it. But it's not big enough to have a material impact on our consolidated costs. But it's our highest cost mine or among our highest cost mines, it's the one obviously that deserves the cutback attention.

Good to see the discipline. Thanks very much. Appreciate the color. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: All right. Thanks, Tony.

Your next question comes from the line of Jeremy Sussman with Clarkson. Please go ahead.

Yeah. Hello and thanks for taking my question. You spoke, obviously, quite a bit about some of the oil and gas initiatives that you are reviewing. But I'm just curious on the copper side. Outside of some of the production potential curtailments that you're looking at, if you consider something either small or even large on the asset sale side, and I guess the context is copper does seem to still be the one commodity that the majors, or at least one of the commodities, I guess, that some of the majors are looking to expand upon. Thank you. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Yeah. Thanks, Jeremy. Listen, we have an open mind on how we approach things. We have a constant flow of people coming to us with ideas, both companies, bankers, some of the private equity funds. So, we get opportunities to consider a lot of things. If you look at the majors, though, there's a consistent positive view of the longer-term copper market. And so, the better assets in that market are owned by the larger companies, and so, that's what is really a barrier for doing major transactions. But, listen, we are – as I said, I was in London last week, saw a lot of people, had a lot of discussions, a lot of people want to meet, present ideas and we're open-minded, we're going to listen to the ideas.

That's great. Thanks very much for taking my question. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Sure.

Your next question comes from the line of John Tumazos with John Tumazos Very Independent Research. Please go ahead.

Thank you very much for all the decisions you've made in the last 90 days for the shareholders and progress since your last call. It's just been spectacular. First question, if you sell down from 90% to 70% in Indonesia, would you be required – would Freeport be required to fund the entire $800 million average full-year CapEx budget, or would the buyer be required to pay its share? First question. Second question, if I may, have any of your commodity long-term price expectations changed in the last year or two as everything has fallen in price? It's notable that a week or two ago, Toyota said that by 2015, they'll stop making gasoline engines. In New Jersey, there is a 3,400 megawatt, 100 mile long wind farm that federal government auctioned without asking New Jersey. West Texas is one company putting up 400,000 solar panels and Fort Stockton and I guess there're several others coming after them. And all these investments are being made not on the basis of price as they affect the energy market. It can create some doubts in our minds once in a while. Please we – we want to thank you for all the good decisions. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Okay. Thanks, John for your comment about steps we've taken. With regard to your first question, the divestment we're talking about is a divestment of shares, common stock in PTFI. And so, whereas now, we own 90% plus. The government has a 9.36% interest. After we go through this process of divestment, which will occur after we get the documentation of our contract extension, we would own 70%, but it's a share investment. And all of these PTFI funding of CapEx is coming out of its cash flows. So, we don't contemplate any of the shareholders being FCX or the new shareholders having any requirements to make capital investments in the company. So, it would come out of cash flows. Then with respect to this future of the energy business, I'll make one side comment. Everything you talked about from electric cars to alternative energy investments requires substantial amounts of copper. And so, that's going to be the demand factor for future – the future of the copper business and all of these issues related to the future of energy and the future of climate change and so forth are – is an unfolding story still to be played out for the foreseeable future. The world's going to require substantial volumes of oil and gas to run these economies and maintain standards of living. James C. Flores - Vice Chairman; President/CEO, Oil & Gas, Freeport-McMoRan, Inc.: John, as long as Exxon, Shell, Chevron, BP are in oil business, I'm going to be in the oil business. So, that's the way I look at it.

Thank you.

Your next question comes from the line of Chris Mancini with Gabelli and Company. Please go ahead.

Hi. Thanks for taking my call. Just a quick question on the dividend. How are you thinking about paying the dividend now, especially considering that you're issuing stock and it would seem that you're free cash flow negative, at least in the current point in time? So, is there a potential for that dividend to be cut back. And second thing is in terms of the equity raises, how much more do you think you would need to raise to have an appropriate buffer for whatever might transpire in the commodities market, again, given that it seems like next year with the high grades at Grasberg in 2017, you'll be pretty significantly free cash flow positive? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Yeah. Good question. This dividend issue, we made a decision to substantially reduce the dividend earlier this year. We maintained a relatively small dividend because certain institutions have dividend requirements. The board's going to continue to review that. And we'll continue to look at. With respect to equity raises, the board's approved this $2 billion raise. We're going to have our finger on the market with the factors that you mentioned. I believe it will, absent some further changes in our free cash flow generation, it's the cash flow coming in, in 2016. This appears to be sufficient to provide the kind of buffer that we need.

Okay. And just a quick question. I know other people kind of asked this, but on the oil and gas business, there are $2.5 billion of oil and gas senior notes. Would it be reasonable to assume that that would be the only amount of debt that the oil and gas business would be able to sustain if it were to be spun off? Or could it potentially take on more debt? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Well, that's a valuation we're doing. It's not related to the source of the debt at all. I mean, that's just the legacy issue that came to our consolidated company when the acquisition was made. So, we're evaluating it more broadly from a financial perspective as to what would be sustainable for the entity that was separated if, in fact, we go a separation route. But it's not tied to any specific issue. Kathleen L. Quirk - Chief Financial Officer, Treasurer & Executive VP: And Chris, just as a reminder, the FCX parent guarantees that debt.

Okay. Kathleen L. Quirk - Chief Financial Officer, Treasurer & Executive VP: So, that guarantee doesn't go away.

Okay. Okay. So, it's just a big picture valuation determination as to how much debt the oil and gas business will be able to take on? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Exactly.

Right. Okay. I understand. Okay. Great. Thanks very much.

Our final question comes from the line of Brian MacArthur with UBS. Please go ahead.

Good morning. I just want to go back to Dave's question on the longer-term situation at Grasberg because you talked about deferring the pyrite ore and stuff. But when I look at the 2018 through 2022 stuff, it all looks like the same guidance. Are you just pushing stuff post-2022 back by deferring this capital, i.e. the KL gets pushed back from 2025 or what exactly is happening there? Because you've obviously been able to save some money up front, but without any change to production in the next five years. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Yes, and that's why it's attractive. That's why it's attractive, Brian. KL is scheduled to come on later. It is much later than that. So the real issue about production is, with the Grasberg Block Cave, and near-term production isn't really affected in any significant way by this deferral of capital, and that would come into play, basically, post-2020. But it's the Grasberg Block Cave production as opposed to the KL production. I mean what we're doing is, as we come out of the pit and start mining the Block Cave, we ramp up to get back to a mill operation of 250,000 tons a day after the ramp-up, which will require several years. And then we have – the great thing about this operation is that we have the ore to feed a 250,000 ton per day mill through 2041.

Right. So are there any secondary benefits by pushing this pyrite ore? Like when you build the new smelter or whatever, does it allow you to put you throughput better there? So you get another benefit there, as well? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Yes, and it also potentially gives us the opportunity to kind of stage the smelter investment at a smaller level to begin with, which saves some capital, and this is desirable, and then deal with it later on, as we ramp back into the pyrite. So there's benefit on CapEx standpoint, both at the mine and mill operations in Papua, as well as capital required for the smelter. Kathleen L. Quirk - Chief Financial Officer, Treasurer & Executive VP: But Brian, all of this is still being looked at and optimized as we go through it. So what you're looking at is our most recent thinking, but we're continuing to look at it, and continue to look at how we smooth out, concentrate production, so we don't have big spikes, and have enough smelter capacity to be able to deal with it. So, it's a work in progress, but what you're seeing is what our current thinking is.

Great. Thanks. And maybe just one question on the oil and gas. You talked about the 25% increase in oil from, I assume, Gulf of Mexico. But what's happening at California next? It looks like it's coming down in the third quarter. Capital there is pretty small. Is it actually on a decline the next three years? Or should we think it bottoms out and flat or how should I think about the reinvestment on that part of the equation? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Well, we've cut reinvestment from $300 million two years ago to $70 million this current year. Probably need to get closer to $125 million, $150 million, to keep production completely flat at this point in time, Brian. So what happens with the thermal reservoirs out there, as you've been heating them for years and years, you can cut capital for about 24 months before they start kind of cooling. And as they start cooling, the oil gets more viscous, and the production rate slows. We're all talking about small, small increments here. So we'll need to start reinvesting there, probably in late 2016, early 2017, and then it flattens out. The one production adjustment that you're seeing is in our offshore business, where we have our (74:06) platform, which is our highest cost production. It's shut in, and it's shut in indefinitely, due to the plains all American pipeline situation, where the pipeline ruptured and they're shut in due to repair work. And that forecast is in years, so we're not sure that production will be restored. So I think the new production level that you see currently is pretty good for 2016 and going forward.

Great. And I should just use about $100 million in capital in California for the next two years, then? Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Yeah. That's probably good average at this point.

Great. Thank you very much. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: Thanks, Brian.

Now, we'll turn the call over to management for any closing remarks. Richard C. Adkerson - Vice Chairman, President & Chief Executive Officer: All I'll say is thank you again for being on the call and your interest. We'll look forward to reporting progress as we go forward and if you have any follow-up questions, as you study the material, or for any reason you feel free to contact David Joint. And we'll make sure the right person answers your questions. Thanks a lot, everybody.

Ladies and gentlemen, that concludes our call for today. Thank you for your participation. You may now disconnect.