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Freeport CEO includes Ajo in restart considerations
Freeport-McMoRan's mining operation in Ajo is under consideration for a restart, according to Freeport president and chief executive officer Richard Adkerson. "We are seeing opportunity for significant growth," he said in a conference call with investors last Wednesday. Ajo is one of. "the projects we're working on diligently."
Adkerson included Ajo as one of the potential additional sul-fides/mill projects for the world's largest copper producer. Other North American operations being studied for expanded activity include Morenci, Sierrita, Bagdad, Twin Buttes, and Safford, he said.
The high price of copper and gold and the positive economics make expanded mining activity feasible. Freeport said that it sold copper during the most recent quarter for an average of $4.31 per pound, compared to $3.42 per pound a year ago. Gold was sold for an average of $1339 per ounce, compared to its previous price of $1110 per ounce last year. Molybdenum's price rose by $3 per pound, from $15.09 to $18.10 during the year.
During the first quarter, said Adkerson, Freeport produced 950 million pounds of copper, 466,000 ounces of gold, and 20 million pounds of molybdenum.
The result, reported Freeport, is that its revenue for the first quarter of 2011 was more than $5.7 billion, compared to $4.4 billion in the comparable quarter a year ago. That resulted in a 2011 first-quarter profit of $1.5 billion, compared to a profit of $897 million last year.
"The economics are extraordinarily positive here," Adkerson said in the conference call.
Freeport estimates that consolidated sales from all mining in 2011 are expected to approximate 3.9 billion pounds of copper, 1.6 million ounces of gold, and 73 million pounds of molybdenum, all significant increases from 2010.
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