2009 Working Toward Sustainable Development Report

WORKING TOWARD SUSTAINABLE DEVELOPMENT FREEPORT-McMoRan COPPER & GOLD INC. 2009 Working Toward Sustainable Development Report A COMMON THREAD We are an important supplier of products on which modern society depends. Thousands of businesses use our products to provide basic infrastructure components that promote higher standards of living, including technological advances that move societies toward a cleaner, healthier, and more productive future. Prominent among these are companies that purchase our copper to produce energy- efficient products, our molybdenum to manufacture high-strength alloys, and our cobalt to create advanced biotechnology applications. Our fundamental challenge is to find the most efficient production methods that will enable us to meet demand for our products in a cost-effective manner while minimizing negative impacts. If resources are not extracted responsibly and in accordance with the needs and standards of society, we will lose the trust of stakeholders. Sustainable development is the foundation on which we operate. The imagery on the cover illustrates common threads that connect our business and society as we work toward sustainable development. FREEPORT-McMoRan COPPER & GOLD INC. 1 PURPOSE OF THIS REPORT TABLE OF CONTENTS This Working Toward Sustainable Development (WTSD) report provides a summary of the progress made on the most significant issues and opportunities faced in our quest 2 Purpose of this Report to responsibly provide essential metals to society. We focus on key areas of interest to international and local stakeholders who demand that our business success be gained 3 Company Profile through socially responsible actions. Report Boundary 4 A Message to Stakeholders Data presented includes the primary operations of Freeport-McMoRan Copper & Gold Inc.’s principal subsidiaries: PT Freeport Indonesia, Freeport-McMoRan Corporation, and Atlantic 6 Our Approach in Working Copper for the period January 1, 2009 to December 31, 2009. The Tenke Fungurume Mining Toward Sustainable project transitioned from construction to operation during 2009 and its data is included for Development the first time this year. Financial data excludes joint venture partners’ interest. As a result of methodology changes or corrections, prior year data has been updated in 12 Our Workforce some cases. Certain data presentation and comparisons may not meet the direct needs of all stakeholders, and we encourage readers to contact our Sustainable Development 17 Human Rights department at [email protected] with inquiries about our reporting. 19 Political Risk and Corruption Global Reporting Initiative (GRI) Application 20 Communities We are reporting in accordance with the GRI G3 reporting guidelines for the second consecutive year, including application of the Mining and Metals Sector Supplement Pilot 25 Indigenous Peoples and version 1.0. We have prepared a supplement for this 2009 WTSD report which includes Cultural Preservation other core and additional indicator responses in accordance with the GRI guidelines. We have self-declared this WTSD report and its supplement at the A+ level of the GRI 27 Artisanal Mining G3 guidelines, indicating reporting of all profile disclosures, disclosures of management approach for each indicator category, responses to core indicators, and external assurance of the report. This WTSD report and its supplement, including a GRI content index, are 28 Resettlement located on our web site. External Assurance 29 Economic Impacts Since 2005, Freeport-McMoRan Copper & Gold Inc. has sought independent verification of its annual sustainability reports, including selected performance data, statements on 31 Environment processes and achievements, and conformance to the GRI guidelines. We are implementing the International Council on Mining & Metals (ICMM) Sustainable Development Framework, 39 Awards including implementation of ICMM’s 10 Sustainable Development Principles across the Company. As the ICMM Sustainable Development Framework evolves, we continuously 40 Assurance Statement update our programs, including external assurance requirements. We have expanded external assurance of our sustainability reporting according to the ICMM Assurance Procedure. Corporate Integrity conducted assurance of our 2009 WTSD reporting. The assurance work scope included visits to three of our major operating sites, in addition to our corporate headquarters, and covered reviews of the 1) alignment of our policies to ICMM’s 10 Sustainable Development Principles and position statements; 2) processes in place to identify and prioritize sustainability risks and opportunities; 3) systems and approaches This icon indicates additional that we are using to manage sustainability risks and opportunities; 4) environmental, social, information (as listed) is and economic sustainability performance data in key risk areas; and 5) application level of available at www.fcx.com. reporting against the GRI G3 reporting guidelines. The assurance statement can be found on page 40. • 2009 WTSD Report and WTSD Supplement • 2007 WTSD Report and GRI (G2) Report 2 Purpose Of This Report • 2008 WTSD Report and GRI (G3) Report COMPANY PROFILE Freeport-McMoRan Copper & Gold Inc. (Freeport-McMoRan) is a leading international mining company with headquarters in Phoenix, Arizona. We operate large, long-lived, geographically diverse assets with significant proven and probable reserves of copper, gold and molybdenum. The Company also has a dynamic portfolio of operating, expansion and growth projects in the copper industry and is the world’s largest producer of molybdenum. Freeport-McMoRan’s portfolio of assets includes the Grasberg minerals district, the world’s largest copper and gold mine in terms of recoverable reserves; significant mining operations in the Americas, including the large-scale Morenci and Safford minerals districts in North America and the Cerro Verde and El Abra operations in South America; and the Tenke Fungurume minerals district in the Democratic Republic of Congo. Freeport-McMoRan Copper & Gold Inc. 2009 Annual Report MAJOR MINE OPERATIONS & DEVELOPMENT PROJECTS All major assets majority-owned and operated Sales From Our Mines In 2009 Locations Copper (Cu) • 4.1 billion pounds of copper Gold (Au) • 2.6 million ounces of gold Molybdenum (Mo) • 58.1 million pounds of molybdenum Cobalt (Co) 3 1 Morenci, Arizona 3 Tyrone, New Mexico 7 Tenke Fungurume, Sierrita, Arizona Democratic Republic of Congo 4 Cerro Verde, Peru Bagdad, Arizona 8 Grasberg, Indonesia Safford, Arizona 5 El Abra, Chile Miami, Arizona 6 Candelaria / 2 Henderson, Colorado Ojos del Salado, Chile Company Profile 3 A MESSAGE TO STAKEHOLDERS The resilience of Freeport-McMoRan Copper & Gold was tested during 2009 as we successfully executed revised operating plans to counter weakening market conditions. Doing so allowed us to benefit from an improved cost structure throughout the year. We are now positioned to excel within our existing asset base of mineral resources and to pursue growth opportunities. While making significant operating adjustments during the global economic crisis, we also faced challenging issues such as providing enhanced workforce security in Indonesia and assisting local government with urgent measures to contain a cholera outbreak near our Tenke Fungurume project in the Democratic Republic of Congo. Concurrently, we focused on the impacts of climate change and water management, both inter-related topics that warrant our long-term attention, consistent with our commitment to the sustainable development of communities where we operate. The interdependency of our operating performance and sustainability programs has never been clearer. We are pleased to report major advancements in implementing the International Council on Mining & Metals (ICMM) Sustainable Development Framework during 2009, including establishment of our Sustainable Development Risk Register process. This tool has aided us in prioritizing health and safety, social, and environmental risks to better direct resources to areas of greatest impact. Safety risks are identified on the sustainable development risk registers at all of our operations, and a central focus of our safety management efforts is to ensure ample resources are directed at mitigation of hazards. In 2009 our Total Recordable Incident Rate improved 40 percent over the prior year, yet our progress was overshadowed by three fatalities. We have reviewed the circumstances surrounding these fatalities, as we do with all safety incidents, so that we can understand how they occurred and determine if we can make improvements systematically and continually. We also formalized our adherence to the standards of the ICMM Fatality Prevention Initiative, which includes a process to communicate lessons learned from safety incidents and near misses. Adherence to these standards for reporting safety planning and performance indicators to senior management will better assist us in leading the effort to protect employees. We operate in some regions of the globe that have civil, political and socio-economic strife. This fact was tragically brought to the forefront on July 11, 2009 when one of our employees was shot and fatally wounded along the road leading to our mining and milling operations in Indonesia. Subsequent to this event, there have been additional shootings along this roadway resulting in the deaths of a security contractor and local policeman as well as additional injuries to employees, contractors and security

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