Turbulence In Indonesia Is Manageable For Freeport-McMoRan
Stephen Simpson, CFA
Stephen Simpson, CFA
Oct. 27, 2014, 8:25 AM
- Workers at Freeport McMoRan's (NYSE:FCX) Grasberg copper mine in Indonesia will hold a one-month strike beginning next week, union officials say, after the company failed to make changes to local management following a fatal accident.
- Three unions are said to have agreed to take strike action from Nov. 6 until Dec. 6.
Oct. 20, 2014, 3:59 PM
- Citigroup upgrades Freeport McMoRan (FCX +1.5%) and three other names in the mining and energy sector, attracted to their valuations after stocks in its coverage area have been hit by the recent correction in the broader market, even as it downgrades Cliffs Natural Resources (CLF +2.2%).
- Analyst Brian Yu raises FCX to Neutral from Sell following the price decline, saying that while the company remains highly leveraged to global growth based on its copper and oil exposure, FCX has been aggressively selling assets to manage the balance sheet.
- Consol Energy (CNX -0.1%), Newmont Mining (NEM +2%) and Alliance Holdings (AHGP +1.9%) are all lifted to Buy from Neutral.
Oct. 13, 2014, 9:57 AM
- Freeport McMoRan's (FCX +1.7%) Indonesian unit can resume open-pit mining at its Grasberg complex after it agreed to improve safety following a fatal accident last month, a senior mines ministry official says.
- Hundreds of protesters blocked access for two days earlier this month to the open-pit area of Grasberg, where production had been halted following the death of four workers on Sept. 27; the area accounts for more than half of the mine's output.
- Open-pit mining remains suspended, Freeport Indonesia CEO Rozik Soetjipto tells Reuters, as the company is still waiting for an official notice.
Oct. 10, 2014, 6:11 PM
- Rio Tinto (NYSE:RIO) may decide that its best defense against another takeover approach from Glencore (OTCPK:GLCNF, OTCPK:GLNCY) is buying the likes of Freeport McMoRan (NYSE:FCX) in a "classic kind of defensive move," Bernstein analyst Paul Gait speculates.
- While Rio is saying it’s better off going it alone, a deal for FCX could help it ward off any further advances from Glencore as well as provide a way to lessen its dependence on iron ore at a time when the metal is slumping, Gait says.
- FCX "fits all the criteria of an attractive takeout candidate and would make sense for... anyone looking to increase their copper exposure and getting some very high-margin energy assets at the same time,” BB&T's Garrett Nelson adds.
- FCX shares are now at their cheapest in more than 15 months relative to EBITDA.
Oct. 8, 2014, 6:34 PM
- Aubrey McClendon, the former Chesapeake Energy CEO who is now running American Energy Partners, is exploring a purchase of Freeport McMoRan’s (NYSE:FCX) California oil and gas operations for up to $5B, Bloomberg reports.
- A deal would be the largest acquisition yet for American Energy, which has raised $13B since it was started last April.
- FCX’s onshore operations in California include 16K net acres in the San Joaquin Basin and control of the Arroyo Grande Field, an oil-producing property in San Luis Obispo County.
Oct. 8, 2014, 10:59 AM
- Workers at Freeport McMoRan's (FCX -0.8%) giant Grasberg copper mine in Indonesia are seeking face-to-face talks with local management and may plan a further mine blockade or strike action, a union official says.
- Hundreds of protestors blocked access for two days last week to Grasberg's open-pit area - which accounts for more than half of the mine's output - where production has been halted following the death of four workers on Sept. 27.
- Fresh protests, blockades or strike action could be triggered if workers' safety concerns and other demands are ignored, according to the union official.
Oct. 6, 2014, 4:38 PM
- Franco-Nevada (NYSE:FNV) agrees to acquire a gold and silver stream on production from the Candelaria and Ojos del Salado mines in Chile from Lundin Mining (OTCPK:LUNMF, OTC:LUNCF) upon completion of the acquisition of Candelaria by Lundin from Freeport McMoRan (NYSE:FCX).
- FNV will provide an up-front deposit of $648M to acquire the gold and silver stream and will subscribe for up to C$50M in Lundin's planned subscription receipts financing.
- FNV -0.9% AH.
Oct. 6, 2014, 4:13 PM
- Freeport McMoRan (NYSE:FCX) agrees to sell its 80% ownership interest in the Candelaria/Ojos del Salado copper mining operations and supporting infrastructure to Lundin Mining (OTCPK:LUNMF, OTC:LUNCF) for $1.8B in cash plus contingent consideration of up to $200M.
- FCX says the deal is another step in its ongoing debt reduction plan and follows the completion of its $3.1B sale of Eagle Ford shale assets in June; it will continue to invest in Chile through opportunities for a major expansion of the El Abra operation.
- The deal is Lundin's biggest ever and marks its first foray into South America.
- FCX says it expects to record a ~$450M after-tax gain on the transaction.
Oct. 2, 2014, 7:58 AM
- Protesters have blockaded Freeport McMoRan's (NYSE:FCX) Grasberg copper mine in Indonesia for a second day, as talks continue between management and employees over the number of fatal accidents at the site.
- Open-pit mining at Grasberg remains suspended after four workers were killed in a collision involving a truck on Saturday; only open-pit mining, which accounts for more than half of total output, is closed.
- Thirty-five people died at the remote complex last year, including 28 who died when a tunnel collapsed.
Sep. 30, 2014, 12:54 PM
- Freeport McMoRan (FCX +0.2%) is upgraded to Buy from Neutral with a $40 price target at BofA/Merrill, which believes upside for the shares more than offsets the risk associated with the ongoing contract negotiations with the government of Indonesia.
- The firm views FCX as a compelling risk-reward profile due to the company's improving free cash flow profile, expected copper sales growth of 35% over the next three years resulting in EBITDA growth of 80%, best in class operating execution, world class brownfield expansions with below average development costs, and a high dividend yield.
Sep. 30, 2014, 8:37 AM
- Newmont Mining (NYSE:NEM) exported 30K metric tons of copper concentrate from Indonesia yesterday, ending a nine-month hiatus and highlighting a ramp up in copper mine supply that is expected to tip the market into surplus this year.
- The country's largest producer, Freeport McMoRan (NYSE:FCX), resumed shipments in early August while saying it had built up a 140K metric ton stockpile and expecting total copper concentrate production to reach 1.8M metric tons this year.
- As a result of boom time investment, new global mine supply is feeding into the market and is expected to result in a surplus, weighted towards the end of the year.
Sep. 29, 2014, 8:19 AM
- Copper mining has been suspended all weekend at Freeport McMoRan's (NYSE:FCX) Grasberg mine in Indonesia after four workers were killed and five others were injured when a car collided with a mining truck.
- FCX so far is unable to give any estimates on the impact to overall production.
- It is the second fatal accident this month at the mine; a boulder fell and killed a worker underground earlier this month.
- FCX -1.3% premarket.
Sep. 24, 2014, 12:05 PM
- Freeport-McMoRan Copper & Gold (NYSE:FCX) declares $0.3125/share quarterly dividend, in line with previous.
- Forward yield 3.77%
- Payable Nov. 3; for shareholders of record Oct. 15; ex-div Oct. 13.
Sep. 15, 2014, 11:23 AM
- Freeport McMoRan (NYSE:FCX) says mining activities at its eastern Indonesian unit have not been affected by an accident that claimed one life, but development work has been suspended as the company and a government team investigate the incident.
- An Indonesian worker was killed over the weekend by falling rocks while working at the underground mine Grasberg Block Cave.
- FCX is developing the underground mine, which it expects to yield ~160K metric tons/day of ore; open-pit mining will end late 2016.
Sep. 2, 2014, 10:28 AM
- Newmont Mining (NEM -2.4%) has reached a tentative agreement to resume exporting copper concentrate from Indonesia as early as this week, the government says.
- According to a top mining industry official, NEM will pay an export tax of 7.5% on its copper concentrate, which is the same rate Freeport McMoRan (NYSE:FCX) negotiated early and significantly lower than the government originally asked; NEM also will increase royalties to 3.75% from 1% for gold, to 4% from 3.5% for copper, and to 3.25% from 1% for silver.
- Although an agreement has been reached in principle, the deal still needs to be approved by several government officials, including the chief economics minister, before an MoU is signed by both parties.
Aug. 29, 2014, 3:57 PM| Aug. 29, 2014, 3:57 PM
Freeport-McMoRan, Inc. engages as copper, gold and molybdenum mining company. The company operates through five segments: North America Copper Mines, South America Copper Mines, Africa Mining, Indonesia Mining, and Molybdenum Mining. The North America Copper Mines segment operates seven open-pit... More
Sector: Basic Materials
Country: United States
Other News & PR