Freeport-McMoRan Copper & Gold Inc. Reports Second-Quarter and Six-Month 2006 Results

HIGHLIGHTS

-- Second-quarter 2006 net income of $367 million, $1.74 per share, compared with net income of $175 million, $0.91 per share, for the second quarter of 2005.

-- Second-quarter 2006 sales for PT Freeport Indonesia (PT-FI), FCX's Indonesian mining unit, totaled 220.1 million pounds of copper and 278.0 thousand ounces of gold, compared with 313.7 million pounds and 616.4 thousand ounces in the second quarter of 2005.

-- Projected annual sales for 2006 approximate 1.2 billion pounds of copper and 1.7 million ounces of gold.

-- FCX's operating cash flows totaled $500 million for the second quarter of 2006. Assuming average prices of $3.00 per pound of copper and $600 per ounce of gold in the second half of 2006, full-year operating cash flows would approximate $1.6 billion. Second-quarter 2006 capital expenditures totaled approximately $58 million and are estimated to approximate $250 million for the year.

-- Total debt as of June 30, 2006, approximated $1.1 billion, $714 million net of $358 million of cash. Total debt was reduced by $184 million during the first six months of 2006.

-- Common stock dividends during the second quarter of 2006 totaled $199 million, $1.0625 per share, including $140 million ($0.75 per share) for a supplemental dividend paid on June 30, 2006.

-- Second-quarter 2006 purchases of FCX common stock totaled 2.0 million shares for $100 million, averaging $49.94 per share.

-- During the first six months of 2006, FCX completed financial transactions totaling $636 million, including $184 million in debt reductions and $452 million in cash to shareholders ($352 million, $1.875 per share, in common stock dividends and $100 million in common stock purchases).

Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) reportedsecond-quarter 2006 net income applicable to common stock of $367.3million, $1.74 per share, compared with net income of $175.2 million,$0.91 per share, for the second quarter of 2005. For the six monthsended June 30, 2006, FCX reported net income of $618.9 million, $2.97per share, compared with $305.6 million, $1.62 per share, in the 2005period. Net income for the second quarter and first six months of 2006included a gain of $8.6 million ($0.04 per share) from the dispositionof land owned by Atlantic Copper, FCX's wholly owned Spanish smeltingunit. Net income for the first six months of 2006 also included lossesof $38.1 million ($0.17 per share) on debt reductions.
SUMMARY FINANCIAL TABLE
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Second Quarter
--------------------------
2006 2005
----------- -----------
(In Thousands, Except
Per Share Amounts)
---------------------------------------- --------------------------
Revenues $1,426,202 $902,909
Operating income 739,327 430,443
Net income applicable to common stock(b) 367,255 175,247
Diluted net income per share of common
stock(c) $1.74 $0.91

Diluted average common shares
outstanding(c) 222,111 219,990


Six Months
--------------------------
2006 2005
----------- -----------
(In Thousands, Except
Per Share Amounts)
---------------------------------------- --------------------------
Revenues $2,512,324 (a) $1,705,974
Operating income 1,271,077 788,042
Net income applicable to common stock(b) 618,905 (a) 305,642
Diluted net income per share of common
stock(c) $2.97 (a) $1.62

Diluted average common shares
outstanding(c) 221,794 220,516
----------------------------------------------------------------------
(a) Includes a loss on the redemption of Gold-Denominated Preferred
Stock, Series II totaling $69.0 million ($36.6 million to net
income or $0.17 per share).
(b) After preferred dividends.
(c) Reflects assumed conversion of FCX's 7% Convertible Senior Notes
and 5 1/2% Convertible Perpetual Preferred Stock. See Note f on
page III.

James R. Moffett, Chairman of the Board of FCX, and Richard C.Adkerson, President and Chief Executive Officer of FCX, said, "Thecombination of our world-class Grasberg operations and positive copperand gold markets continues to provide strong financial results.Favorable market conditions for our commodities are enabling us toreturn significant cash to our shareholders while we are takingactions to strengthen our balance sheet. The outlook for our businessis positive. We are committed to realizing long-term values for ourshareholders by producing our Grasberg open pit and undergroundresources in a safe and cost efficient manner and by continuing to addto these resources through our ongoing exploration and developmentactivities."

PT-FI PRODUCTION AND SALES

PT-FI mined lower grade ore and reported lower production andsales in the second quarter of 2006 than in the second quarter of2005. PT-FI's share of second-quarter 2006 production totaled 237.1million pounds of copper and 307.3 thousand ounces of gold. PT-FIexperienced weather-related shipping delays at the end of June,resulting in PT-FI's share of second-quarter 2006 copper sales of220.1 million pounds being lower than the previous estimate of 235.0million pounds announced on June 5, 2006. PT-FI's share ofsecond-quarter 2006 gold sales of 278.0 thousand ounces slightlyexceeded the previous estimate of 275.0 thousand ounces. As previouslyreported, in May 2006 PT-FI encountered a relatively small section ofore in the "6 North" pushback with abnormally high clay content, whichadversely affected ore flow, mill recoveries and concentrate grades.Operations improved during June as PT-FI gained access to better oretypes.
----------------------------------------------------------------------
Second Quarter
--------------------------
2006 2005
---------------------------------------- ----------- -----------
Copper (000s of recoverable pounds):
Production 237,100 302,300
Sales 220,100 313,700
Average realized price per pound $3.33 $1.53
Gold (recoverable ounces):
Production 307,300 591,300
Sales 278,000 616,400
Average realized price per ounce $613.77 $428.23


Six Months
--------------------------
2006 2005
---------------------------------------- ----------- -----------
Copper (000s of recoverable pounds):
Production 458,400 637,900
Sales 445,300 641,800
Average realized price per pound $3.27 $1.54
Gold (recoverable ounces):
Production 769,100 1,200,700
Sales 750,500 1,211,700
Average realized price per ounce $492.73 (a) $427.54
----------------------------------------------------------------------
(a) Amount was $585.34 before revenue reduction resulting from
redemption of FCX's Gold-Denominated Preferred Stock, Series II.

In the second quarter of 2006, copper ore grades averaged 0.72percent and recovery rates averaged 84.1 percent, compared with 0.98percent and 87.4 percent for the second quarter of 2005. Gold oregrades averaged 0.67 grams per metric ton (g/t) and recovery ratesaveraged 76.4 percent in the second quarter of 2006, compared with1.43 g/t and 83.8 percent for the second quarter of 2005. Average oregrades are expected to improve in the second half of 2006 with thehighest grades expected to be mined in the fourth quarter.

Mill throughput, which varies depending on ore types beingprocessed, averaged 223,700 metric tons of ore per day in the secondquarter of 2006 compared with 211,800 metric tons of ore in the secondquarter of 2005. Mill rates are expected to average over 220,000metric tons of ore per day in the second half of 2006.

Production from PT-FI's Deep Ore Zone (DOZ) underground mineaveraged 47,200 metric tons of ore per day in the second quarter of2006, representing 21 percent of mill throughput. DOZ continues toperform above design capacity of 35,000 metric tons of ore per day.PT-FI is expanding the capacity of the DOZ underground operation to asustained rate of 50,000 metric tons per day with the installation ofa second crusher and additional ventilation, expected to be completedin mid-2007. PT-FI is completing plans that are anticipated to expandthe capacity of the DOZ mine to 80,000 metric tons per day. The DOZmine is one of the world's largest underground mines.

Realized copper prices more than doubled to an average of $3.33per pound in the second quarter of 2006 from $1.53 per pound in thesecond quarter of 2005. The spot copper price on the London MetalExchange (LME) closed at $3.56 per pound on July 17, 2006. Realizedgold prices improved by 43 percent to an average of $613.77 per ouncein the second quarter of 2006 from $428.23 per ounce in the secondquarter of 2005. The London P.M. gold fixing price closed at $652.50per ounce on July 17, 2006.

FCX's concentrate sales for the second quarter of 2006 included185.1 million pounds of copper, priced at an average of $3.34 perpound, subject to final pricing over the next several months. Each$0.05 change in the price realized from the June 30 price would resultin an approximate $5 million effect on FCX's 2006 net income.Second-quarter 2006 adjustments to concentrate sales recognized inprior quarters increased revenues by $146.6 million ($77.7 million tonet income or $0.35 per share) compared with $12.6 million ($6.7million to net income or $0.03 per share) in the second quarter of2005.

PT-FI's share of annual sales in 2006 is currently projected toapproximate 1.2 billion pounds of copper and 1.7 million ounces ofgold, compared with previous estimates of 1.3 billion pounds and 1.7million ounces. The reduction in estimated copper sales primarilyreflects the operational issues experienced in the second quarter andthe impact of mine plan revisions to incorporate geotechnical data.Efforts are under way to improve productivity of mining activitieswhich would increase mining rates and advance timing of metalproduction. At the Grasberg mine, the sequencing in mining areas withvarying ore grades causes fluctuations in the timing of oreproduction, resulting in varying quarterly and annual sales of copperand gold. During 2006, approximately 63 percent of copper and 55percent of gold sales are expected in the second half of the year,including 280.0 million pounds of copper and 320.0 thousand ounces ofgold in the third quarter of 2006 and 475.0 million pounds of copperand 610.0 thousand ounces of gold in the fourth quarter of 2006. Theachievement of PT-FI's sales estimates will be dependent, among otherfactors, on the achievement of targeted mining rates, the successfuloperation of PT-FI production facilities and the impact of weatherconditions at the end of fiscal periods on concentrate loadingactivities.

PT-FI's mine plans are based on latest available data and studies,which take into account factors such as mining and milling rates, oregrades and recoveries, economic conditions and geologic/geotechnicalconsiderations. PT-FI updates these plans to incorporate new data andconditions, with the objective of operating safely, managing risks andmaximizing economic values. While ongoing analyses may alter currentexpectations, PT-FI's five-year mine plan has been revised as follows:
PT-FI's Share of Sales
----------------------------------------------------------------------
Previous Estimate Current Estimate
---------- -------------------------- --------------------------
Copper Gold Copper Gold
billion lbs million ozs billion lbs million ozs
---------- -------------------------- --------------------------
2006 1.3 1.7 1.2 1.7
2007 1.2 2.0 1.1 1.8
2008 1.5 2.4 1.4 1.9
2009 1.2 1.6 1.2 1.8
2010 1.3 1.9 1.3 2.1
---------- -------------------------- --------------------------
Total 6.5 9.6 6.2 9.3
---------- -------------------------- --------------------------
5-Year Average 1.3 1.9 1.24 1.9
----------------------------------------------------------------------
Percent Change of Total (4.6)% (3.1)%
----------------------------------------------------------------------

These revisions include updated estimates for 2006 and designchanges to incorporate recent geotechnical data, resulting in deferralof production of certain high-grade ore from 2007 and 2008 into futureperiods. The revised mine plans also incorporate an anticipatedexpansion of the DOZ underground mine to 80,000 metric tons of ore perday, which would accelerate the production of high grade ore from DOZ.The preliminary economics of this project appear highly attractive.The mine plan changes affect the timing of metal production and do notimpact ultimate recoverable reserves. PT-FI's initiatives to improveproductivity and mining rates are an important factor in the abilityto meet or potentially to exceed these plans.

PT-FI is also continuing to analyze its longer range mine plans toassess the optimal design of the Grasberg open pit, which may affectthe timing of development of the Grasberg underground block cave orebody. PT-FI's previous plan included the transition from the Grasbergopen pit to the Grasberg block cave ore body in 2015. PT-FI expects tocomplete the current studies on longer range plans by year-end 2006.
UNIT NET CASH COSTS
----------------------------------------------------------------------
Second Quarter
--------------------------
2006 2005
---------------------------------------- ----------- -----------
Per pound of copper:
Site production and delivery, after
adjustments $1.23 $0.71
Gold and silver credits (0.85) (0.87)
Treatment charges 0.49 (a) 0.21
Royalties 0.11 0.06
----------- -----------
Unit net cash costs (b) $0.98 $0.11


Six Months
--------------------------
2006 2005
---------------------------------------- ----------- -----------
Per pound of copper:
Site production and delivery, after
adjustments $1.23 $0.65
Gold and silver credits (1.07) (0.83)
Treatment charges 0.43 (a) 0.21
Royalties 0.09 0.06
----------- -----------
Unit net cash costs (b) $0.68 $0.09
----------------------------------------------------------------------
(a) Includes $0.07 per pound in the second quarter and $0.03 per pound
in the six-month period for adjustments to prior periods'
concentrate sales subject to final pricing to reflect the impact
on treatment charges resulting from the increase in copper prices.
(b) For a reconciliation of unit net cash costs per pound to
production and delivery costs applicable to sales reported in
FCX's consolidated financial statements refer to the attached
presentation, "Product Revenues and Production Costs."

PT-FI's unit net cash costs, including gold and silver credits,averaged $0.98 per pound of copper during the second quarter of 2006,compared with $0.11 per pound in the 2005 quarter. The higher unitsite production and delivery costs in the 2006 period primarilyreflected lower sales volumes resulting from mine sequencing in theGrasberg open pit, higher treatment charges and royalties attributableto increased copper prices, the impact of changes in accounting forstripping costs and higher input costs, including energy. Unit siteproduction and delivery costs will vary with fluctuations inproduction volumes because of the primarily fixed nature of PT-FI'scost structure.

On January 1, 2006, FCX adopted Emerging Issues Task Force IssueNo. 04-6, "Accounting for Stripping Costs Incurred during Productionin the Mining Industry" (EITF 04-6), which requires that strippingcosts be included in costs of sales as incurred beginning in 2006.Upon adoption of EITF 04-6, FCX eliminated its deferred mining costasset ($285.4 million) at December 31, 2005, net of taxes, minorityinterest share and inventory effects ($135.9 million), as a cumulativeeffect adjustment which reduced its retained earnings on January 1,2006. Unit site production and delivery costs were net of deferredmining costs of $0.07 per pound ($20.6 million) in the second quarterof 2005 and $0.08 per pound ($52.8 million) in the first six months of2005.

Assuming average copper prices of $3.00 per pound and average goldprices of $600 per ounce for the remainder of 2006 and achievement ofcurrent 2006 sales estimates, PT-FI estimates that its annual 2006unit net cash costs, including gold and silver credits, wouldapproximate $0.66 per pound. Estimated unit net cash costs for 2006are projected to be higher than the 2005 average, primarily because oflower 2006 copper and gold sales volumes, higher treatment charges androyalties attributable to increased copper prices and the change inthe accounting treatment of stripping costs. Estimated average 2006unit net cash costs are higher than previous estimates of $0.54 perpound, primarily reflecting the impact of higher copper prices ontreatment charges and royalties, lower copper volumes and higherenergy costs. Unit net cash costs for 2006 would change byapproximately $0.02 per pound for each $25 per ounce change in theaverage price of gold for the balance of the year.

SMELTER OPERATIONS

FCX's investment in smelters serves an important role in itsconcentrate marketing strategy. Through downstream integration, FCXassures placement of a significant portion of its concentrateproduction. Taking into account taxes and minority ownershipinterests, an equivalent change in smelting and refining chargesessentially offset in FCX's consolidated operating results.

Atlantic Copper treated 228,900 metric tons of concentrate andscrap in the second quarter of 2006, compared with 246,900 metric tonsin the year-ago period. Atlantic Copper produced 131.5 million poundsof cathodes and sold 131.1 million pounds of cathodes during thesecond quarter of 2006, compared with cathode production of 137.8million pounds and sales of 140.8 million pounds during the secondquarter of 2005. Treatment charges received by Atlantic Copperaveraged $0.34 per pound during the second quarter of 2006 and $0.21per pound during the second quarter of 2005. The significant increasein treatment charges in the 2006 period reflects higher market ratesand $0.09 per pound ($0.03 per pound in the second quarter of 2005)for price participation under the terms of Atlantic Copper'sconcentrate purchase and sales agreements. Cathode cash unit costsaveraged $0.21 per pound in the second quarter of 2006 and $0.18 perpound in the second quarter of 2005 (see attached presentation,"Cathode Cash Unit Costs"). Higher unit costs in 2006 primarilyreflect the impact of lower volumes.

Atlantic Copper reported operating income of $21.8 million for thesecond quarter of 2006, compared with an operating loss of $0.1million in the 2005 period. The positive results in the 2006 periodprimarily reflect higher treatment charges, net of higher costs. Each$0.01 change in treatment and refining charge rates equates toapproximately $6 million of Atlantic Copper annual operating income.

PT Smelting, PT-FI's 25 percent-owned Indonesian smelting unit,treated 187,500 metric tons of concentrates in the second quarter of2006, compared with 230,700 metric tons in the year-ago period. PTSmelting completed a 22-day maintenance turnaround in the secondquarter of 2006 which resulted in lower production during the period.PT Smelting is currently expanding its production capacity from250,000 metric tons of copper metal per year to 270,000 metric tons ofcopper metal per year. PT Smelting produced 127.3 million pounds ofcathodes for the second quarter of 2006, compared with cathodeproduction of 146.1 million pounds during the second quarter of 2005.PT Smelting's cathode cash unit cost per pound totaled $0.25 per poundin the second quarter of 2006 and $0.10 per pound in the year-agoperiod (see attached presentation, "Cathode Cash Unit Costs"),primarily reflecting the impact of the maintenance turnarounddiscussed above and higher energy costs in 2006. PT-FI's equityinterest in PT Smelting's earnings totaled $2.0 million, $1.6 millionto net income or $0.01 per share, in the second quarter of 2006compared to $2.6 million, $2.1 million to net income or $0.01 pershare, in the 2005 quarter.

FCX defers recognition of profits on PT-FI's sales to AtlanticCopper and on 25 percent of PT-FI's sales to PT Smelting until thefinal sales to third parties occur. Changes in these net deferralsresulted in an addition to FCX's net income totaling $18.1 million,$0.08 per share, in the second quarter of 2006, compared with anaddition of $25.7 million, $0.12 per share, in the second quarter of2005, and an addition of $57.4 million, $0.26 per share, in the firstsix months of 2006, compared with a reduction of $8.5 million, $0.04per share, in the first six months of 2005. At June 30, 2006, FCX'snet deferred profits on PT-FI concentrate inventories at AtlanticCopper and PT Smelting to be recognized in future periods' net incomeafter taxes and minority interests sharing totaled $60.5 million.Based on copper prices of $3.00 per pound and gold prices of $600 perounce for the third quarter of 2006 and current shipping schedules,FCX estimates that the net change in deferred profits on intercompanysales will result in a decrease to net income of approximately $10million in the third quarter of 2006. The actual change in deferredintercompany profits may differ substantially from this estimatebecause of changes in the timing of shipments to affiliated smeltersand metal prices.

EXPLORATION and MINE DEVELOPMENT ACTIVITIES

PT-FI's exploration efforts in 2006 are focused on testingextensions of the Deep Grasberg and Kucing Liar mine complex, theresource potential below the previously mined Ertsberg deposit andother targets in Block A of its Contract of Work, the existingproducing area of the Grasberg minerals district. FCX continues toassess the timing of resumption of suspended exploration activities inprospective areas outside Block A.

In 2004, PT-FI commenced its Common Infrastructure project, whichwill provide access to its large undeveloped underground ore bodieslocated in the Grasberg minerals district through a tunnel systemlocated approximately 400 meters deeper than its existing undergroundtunnel system. In addition to providing access to its underground orebodies, the tunnel system will enable PT-FI to conduct futureexploration in prospective areas associated with its currentlyidentified ore bodies. Development of the Common Infrastructureproject is progressing according to plan.

PT-FI is also developing the Big Gossan underground mine, ahigh-grade deposit located near the existing milling complex. Theengineering design for Big Gossan includes 53 million metric tons ofore, grading 2.3 percent copper and 1.1 g/t of gold, expected to yieldaggregate recoverable copper of 2.5 billion pounds and aggregaterecoverable gold of 1.2 million ounces. Aggregate capital expendituresfor Big Gossan to be incurred over a four-year period beginning in2005 total approximately $225 million, $195 million net to PT-FI, witha ramp-up to full production of 7,000 metric tons per day by 2010(average annual aggregate incremental production approximating 135million pounds of copper and 65,000 ounces of gold, with PT-FIreceiving 60 percent of these amounts).

As discussed above, PT-FI is expanding the DOZ underground mine to50,000 metric tons per day from the current capacity of 35,000 metrictons per day. The 50,000 metric tons per day expansion is on track forcompletion in mid-2007. PT-FI anticipates expanding this mine furtherto 80,000 metric tons of ore per day.

CASH FLOWS and DEBT REDUCTIONS

FCX generated operating cash flows totaling $499.7 million duringthe second quarter of 2006 and $375.9 million for the first half of2006. Operating cash flows for the first six months of 2006 werereduced by $519.2 million used for working capital requirements,including $328.4 million for income tax payments attributable toearnings in 2005. Capital expenditures totaled $58.2 million for thesecond quarter of 2006 and $110.3 million for the first half of 2006.FCX's capital expenditures for 2006 are currently estimated toapproximate $250 million.

Using estimated sales volumes for the remainder of 2006 andassuming average prices of $3.00 per pound of copper and $600 perounce of gold for the remainder of 2006, FCX would generate operatingcash flows approximating $1.6 billion in 2006, with over $1.2 billionin the second half of the year. In the balance of the year, each $0.10per pound change in copper prices would affect 2006 cash flows byapproximately $38 million and each $25 per ounce change in gold priceswould affect 2006 cash flows by approximately $12 million.

Total debt as of June 30, 2006 approximated $1.1 billion, $714.1million net of $357.8 million of cash. Total debt was reduced by$184.1 million in the first half of 2006, including $167.4 million forthe mandatory redemption of FCX's Gold-Denominated Preferred Stock,Series II in the first quarter for $236.4 million, resulting in a$69.0 million loss recognized in revenues ($36.6 million to net incomeor $0.17 per share) for the first six months of 2006. Other debtreductions in the first half of 2006 included privately negotiatedtransactions to induce conversion of $16.0 million of 7% ConvertibleSenior Notes due 2011 into 0.5 million shares of FCX common stock andpurchases in open market transactions of $11.5 million of 10 1/8%Senior Notes due 2010 for $12.6 million. As a result of the inducedconversions and open market transactions, FCX recorded charges of $2.2million ($1.5 million to net income, net of related reduction ofinterest expense, or $0.01 per share) in the first six months of 2006.

Following the debt repayments and redemption during the first halfof 2006, FCX's debt maturities for the remainder of 2006 total $92.1million, including $25.8 million for the final redemption of FCX'smandatorily redeemable silver preferred stock, which will result in a$12.5 million decrease in debt and a reduction of revenues of $13.3million, $7.0 million to net income, in the third quarter of 2006.Debt maturities total $58.5 million for the three-year period of 2007through 2009. FCX will continue to consider opportunities to repaydebt in advance of scheduled maturities.

FCX is completing arrangements to amend its $195 million revolvingcredit facility scheduled to mature in September 2006. In addition toextending the maturity to 2009, FCX expects to increase the size ofthe facility to $465 million, which may be expanded to up to $500million with additional lender commitments.

FINANCIAL POLICY

FCX has a long-established tradition of returning substantial cashto shareholders through dividends and share purchases. Based oncurrent mine plans and subject to future copper and gold prices, FCXexpects its cash flows to exceed budgeted capital expenditures, whichwould provide opportunities to reduce debt further and return cash toshareholders through dividends and share purchases.

Financial transactions completed during the second quarter of 2006totaled $328.5 million, including $29.4 million in debt reductions,$199.3 million in common stock dividends ($1.0625 per share) and $99.8million used to purchase 2.0 million shares of common stock at anaverage price of $49.94 per share. Dividends included a supplementaldividend of $0.75 per share paid on June 30, 2006. Year-to-date, FCXhas completed approximately $636 million in financial transactions,including debt reductions totaling $184.1 million, common stockdividends totaling $352.5 million ($1.875 per share) and $99.8 millionin common stock purchases. Since December 2004, FCX has paid sixsupplemental dividends totaling $551.7 million ($3.00 per share).

FCX has purchased a total of 7.8 million shares for $279.5 million(average of $36.05 per share) under its Board authorized 20-millionshare open market purchase program. As of July 17, 2006, 12.2 millionshares remain available for purchase under the program. As of June 30,2006, FCX had 187.2 million common shares outstanding.

The potential payment of future regular and supplemental dividendswill be determined by FCX's Board of Directors and will be dependentupon many factors, including FCX's cash flows and financial position,copper and gold prices and general economic and market conditions. Thetiming of future purchases of FCX's common stock depends on a numberof factors including the price of its common shares, its cash flowsand financial position, copper and gold prices and general economicand market conditions.

FCX explores for, develops, mines and processes ore containingcopper, gold and silver in Indonesia, and smelts and refines copperconcentrates in Spain and Indonesia. Additional information on FCX isavailable on our web site, www.fcx.com.

Cautionary Statement and Regulation G Disclosure. This pressrelease contains forward-looking statements in which we discussfactors we believe may affect our performance in the future.Forward-looking statements are all statements other than historicalfacts, such as statements regarding projected ore grades and millingrates, projected sales volumes, projected unit net cash costs,projected treatment charge rates, projected operating cash flows,projected capital expenditures, the impact of copper and gold pricechanges, and the impact of changes in deferred intercompany profits onearnings. Accuracy of the projections depends on assumptions aboutevents that change over time and is thus susceptible to periodicchange based on actual experience and new developments. Thedeclaration and payment of dividends is at the discretion of thecompany's Board of Directors and will depend on the company's cashflows and financial position, copper and gold prices and generaleconomic and market conditions. FCX cautions readers that it assumesno obligation to update or publicly release any revisions to theprojections in this press release and, except to the extent requiredby applicable law, does not intend to update or otherwise revise theprojections more frequently than quarterly. Additionally, importantfactors that might cause future results to differ from theseprojections include mine sequencing, production rates, industry risks,commodity prices, Indonesian political risks, weather-related risks,currency translation risks and other factors described in FCX's AnnualReport on Form 10-K for the year ended December 31, 2005, filed withthe Securities and Exchange Commission.

This press release also contains certain financial measures suchas unit net cash costs per pound of copper and cathode cash unit costper pound of copper. As required by Securities and Exchange CommissionRegulation G, reconciliations of these measures to amounts reported inFCX's consolidated financial statements are provided in theattachments to this press release.

A copy of this press release is available on our web site,"www.fcx.com." A conference call with securities analysts aboutsecond-quarter 2006 results is scheduled for today at 10:00 a.m. EDT.The conference call will be broadcast on the Internet along withslides. Interested parties may listen to the webcast live and view theslides by accessing "www.fcx.com." A replay of the webcast will beavailable through Friday, August 11, 2006.
FREEPORT-McMoRan COPPER & GOLD INC.
SELECTED OPERATING DATA

Second Quarter
------------------------
2006 2005
---------- ----------
PT Freeport Indonesia, Net of Rio Tinto's
Interest
Copper (recoverable)
Production (000s of pounds) 237,100 302,300
Production (metric tons) 107,500 137,100
Sales (000s of pounds) 220,100 313,700
Sales (metric tons) 99,900 142,300
Average realized price per pound $3.33 $1.53
Gold (recoverable ounces)
Production 307,300 591,300
Sales 278,000 616,400
Average realized price per ounce $613.77 $428.23
Silver (recoverable ounces)
Production 877,300 1,020,400
Sales 835,200 1,057,700
Average realized price per ounce $11.74 $7.04

PT Freeport Indonesia, 100% Aggregate
Ore milled (metric tons per day) 223,700 211,800
Average ore grade
Copper (percent) 0.72 0.98
Gold (grams per metric ton) 0.67 1.43
Gold (ounce per metric ton) 0.022 0.046
Silver (grams per metric ton) 3.84 4.54
Silver (ounce per metric ton) 0.123 0.146
Recovery rates (percent)
Copper 84.1 87.4
Gold 76.4 83.8
Silver 47.8 53.2
Copper (recoverable)
Production (000s of pounds) 258,800 349,200
Production (metric tons) 117,300 158,400
Sales (000s of pounds) 239,900 362,500
Sales (metric tons) 108,800 164,400
Gold (recoverable ounces)
Production 325,700 727,400
Sales 293,800 758,600
Silver (recoverable ounces)
Production 900,000 1,211,500
Sales 844,300 1,256,700

Six Months
------------------------
2006 2005
---------- ----------
PT Freeport Indonesia, Net of Rio Tinto's
Interest
Copper (recoverable)
Production (000s of pounds) 458,400 637,900
Production (metric tons) 207,900 289,300
Sales (000s of pounds) 445,300 641,800
Sales (metric tons) 202,000 291,100
Average realized price per pound $3.27 $1.54
Gold (recoverable ounces)
Production 769,100 1,200,700
Sales 750,500 1,211,700
Average realized price per ounce $492.73 (a) $427.54
Silver (recoverable ounces)
Production 1,556,400 2,318,000
Sales 1,542,300 2,328,000
Average realized price per ounce $11.19 $7.02

PT Freeport Indonesia, 100% Aggregate
Ore milled (metric tons per day) 220,200 205,600
Average ore grade
Copper (percent) 0.72 1.06
Gold (grams per metric ton) 0.79 1.52
Gold (ounce per metric ton) 0.025 0.049
Silver (grams per metric ton) 4.02 4.89
Silver (ounce per metric ton) 0.129 0.157
Recovery rates (percent)
Copper 83.3 88.5
Gold 78.8 83.3
Silver 41.9 55.6
Copper (recoverable)
Production (000s of pounds) 505,400 739,500
Production (metric tons) 229,200 335,400
Sales (000s of pounds) 491,200 743,900
Sales (metric tons) 222,800 337,400
Gold (recoverable ounces)
Production 796,400 1,491,300
Sales 780,100 1,501,800
Silver (recoverable ounces)
Production 1,594,100 2,599,500
Sales 1,555,400 2,614,200

(a) Amount was $585.34 before a loss resulting from redemption of
FCX's Gold-Denominated Preferred Stock, Series II.




FREEPORT-McMoRan COPPER & GOLD INC.
SELECTED OPERATING DATA

Second Quarter Six Months
----------------- -----------------
2006 2005 2006 2005
-------- -------- -------- --------
Atlantic Copper
Concentrate and scrap treated
(metric tons) 228,900 246,900 479,600 462,700
Anodes
Production (000s of pounds) 138,700 159,400 295,800 306,800
Production (metric tons) 62,900 72,300 134,200 139,200
Sales (000s of pounds) 7,300 15,300 33,700 36,200
Sales (metric tons) 3,300 6,900 15,300 16,400
Cathodes
Production (000s of pounds) 131,500 137,800 260,900 269,500
Production (metric tons) 59,600 62,500 118,300 122,200
Sales (000s of pounds) 131,100 140,800 267,700 273,400
Sales (metric tons) 59,400 63,900 121,400 124,000
Gold sales in anodes and slimes
(ounces) 199,000 178,900 444,600 246,200
Cathode cash unit cost per
pound(a) $0.21 $0.18 $0.20 $0.18

PT Smelting, 25%-owned by PT
Freeport Indonesia
Concentrate treated (metric tons) 187,500 230,700 421,900 457,100
Anodes
Production (000s of pounds) 110,900 153,100 258,700 304,400
Production (metric tons) 50,300 69,500 117,300 138,100
Cathodes
Production (000s of pounds) 127,300 146,100 269,700 289,600
Production (metric tons) 57,700 66,300 122,300 131,400
Sales (000s of pounds) 129,600 145,500 270,300 289,200
Sales (metric tons) 58,800 66,000 122,600 131,200
Cathode cash unit cost per
pound(b) $0.25 $0.10 $0.19 $0.10

(a) For a reconciliation of cathode cash unit cost per pound to
production costs applicable to sales reported in FCX's
consolidated financial statements refer to the attached
presentation, "Cathode Cash Unit Costs."
(b) For a reconciliation of cathode cash unit cost per pound to equity
in PT Smelting's earnings reported in FCX's consolidated financial
statements refer to the attached presentation, "Cathode Cash Unit
Costs."




FREEPORT-McMoRan COPPER & GOLD INC.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

Three Months Ended
June 30,
--------------------------
2006 2005
----------- -----------
(In Thousands, Except Per
Share Amounts)
Revenues(a) $1,426,202 $ 902,909
Cost of sales:
Production and delivery(b) 605,607 390,586 (c)
Depreciation and amortization 43,355 54,159
----------- -----------
Total cost of sales 648,962 444,745
Exploration expenses(b) 2,778 2,342
General and administrative
expenses(b, d) 35,135 25,379
----------- -----------
Total costs and expenses 686,875 472,466
----------- -----------
Operating income 739,327 430,443
Equity in PT Smelting earnings 2,006 2,562
Interest expense, net (21,024) (35,292)
(Losses) gains on early extinguishment
and conversion of debt (267) -
Other income, net 14,616 (e) 8,143
----------- -----------
Income before income taxes and minority
interests 734,658 405,856
Provision for income taxes (310,244) (188,684)

Minority interests in net income of
consolidated subsidiaries (42,034) (26,800)
----------- -----------
Net income 382,380 190,372
Preferred dividends (15,125) (15,125)
----------- -----------
Net income applicable to common stock $ 367,255 $ 175,247
=========== ===========

Net income per share of common stock:
Basic $1.95 $0.98
=========== ===========
Diluted(f) $1.74 $0.91
=========== ===========
Average common shares outstanding:

Basic 188,506 178,324
=========== ===========
Diluted(f) 222,111 219,990
=========== ===========
Dividends paid per share of common
stock $1.0625 $0.25
=========== ===========

Six Months Ended
June 30,
--------------------------
2006 2005
----------- -----------
(In Thousands, Except Per
Share Amounts)
Revenues(a) $2,512,324 $1,705,974
Cost of sales:
Production and delivery(b) 1,083,522 755,592 (c)
Depreciation and amortization 86,605 111,085
----------- -----------
Total cost of sales 1,170,127 866,677
Exploration expenses(b) 5,354 4,262
General and administrative
expenses(b, d) 65,766 46,993
----------- -----------
Total costs and expenses 1,241,247 917,932
----------- -----------
Operating income 1,271,077 788,042
Equity in PT Smelting earnings 5,565 5,158
Interest expense, net (43,695) (72,840)
(Losses) gains on early extinguishment
and conversion of debt (2,240) 37
Other income, net 19,574 (e) 16,095
----------- -----------
Income before income taxes and minority
interests 1,250,281 736,492
Provision for income taxes (531,966) (352,712)

Minority interests in net income of
consolidated subsidiaries (69,160) (47,888)
----------- -----------
Net income 649,155 335,892
Preferred dividends (30,250) (30,250)
----------- -----------
Net income applicable to common stock $ 618,905 $ 305,642
=========== ===========

Net income per share of common stock:
Basic $3.29 $1.71
=========== ===========
Diluted(f) $2.97 $1.62
=========== ===========
Average common shares outstanding:

Basic 188,211 178,822
=========== ===========
Diluted(f) 221,794 220,516
=========== ===========
Dividends paid per share of common
stock $1.875 $1.00
=========== ===========

(a) Includes positive adjustments to prior period concentrate sales
totaling $146.6 million for the 2006 quarter, $12.6 million for
the 2005 quarter, $137.9 million for the 2006 six-month period and
$8.7 million for the 2005 six-month period.
(b) On January 1, 2006, FCX adopted Statement of Financial Accounting
Standards No. 123 (revised 2004), "Share-Based Payment" or "SFAS
123R." Incremental costs associated with adoption of SFAS 123R
totaled $6.8 million ($4.0 million to net income) in the 2006
quarter and $15.9 million ($9.3 million to net income) in the 2006
six-month period. Total stock-based compensation costs follow (in
millions):
Second Six-Month
Quarter Period
------------- -------------
2006 2005 2006 2005
------ ------ ------ ------
Production and delivery costs $5.5 $1.3 $11.6 $2.6
Exploration expenses 0.3 - 0.7 -
General and administrative expenses 6.3 2.2 13.2 5.3
------ ------ ------ ------
Total stock-based compensation
costs $12.1 $3.5 $25.5 $7.9
====== ====== ====== ======

(c) Amounts are net of deferred mining costs of $20.6 million for the
2005 quarter and $52.8 million for the 2005 six-month period. On
January 1, 2006, FCX adopted new accounting rules, described in
Note a on page IV, which require that stripping costs incurred
during production be charged to cost of sales as incurred.
(d) Includes Rio Tinto's share of joint venture reimbursements for
employee stock option exercises which decreased general and
administrative expenses by $2.6 million for the 2006 quarter, $0.1
million for the 2005 quarter, $7.1 million for the 2006 six-month
period and $3.0 million for the 2005 six-month period.
(e) Includes an $8.6 million gain from the disposition of certain land
owned by Atlantic Copper.
(f) Reflects assumed conversion of FCX's 7% Convertible Senior Notes
and 5 1/2% Convertible Perpetual Preferred Stock, resulting in the
exclusion of interest expense totaling $5.1 million and dividends
totaling $15.1 million for the 2006 quarter, interest expense of
$10.3 million and dividends totaling $15.1 million for the 2005
quarter, interest expense of $10.2 million and dividends of $30.3
million for the 2006 six-month period and interest expense of
$20.6 million and dividends of $30.3 million for the 2005
six-month period, and the inclusion of 32.0 million shares for the
2006 quarter, 39.8 million shares for the 2005 quarter, 31.9
million shares for the 2006 six-month period and 39.7 million
shares for the 2005 six-month period.




FREEPORT-McMoRan COPPER & GOLD INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

June 30, December 31,
2006 2005
----------- -----------
(In Thousands)

ASSETS
Current assets:
Cash and cash equivalents $ 357,751 $ 763,599
Accounts receivable 685,275 687,969
Inventories 790,942 565,019
Prepaid expenses and other 18,534 5,795
----------- -----------
Total current assets 1,852,502 2,022,382
Property, plant, equipment and
development costs, net 3,104,806 3,088,931
Deferred mining costs - (a) 285,355 (a)
Other assets 111,661 119,999
Investment in PT Smelting 40,570 33,539
----------- -----------
Total assets $5,109,539 $5,550,206
=========== ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued
liabilities $ 581,022 $ 573,560
Accrued income taxes 94,563 327,041
Current portion of long-term debt and
short-term borrowings 89,683 253,350
Unearned customer receipts 56,900 57,184
Accrued interest payable 29,828 32,034
Rio Tinto share of joint venture cash
flows 26,251 125,809
----------- -----------
Total current liabilities 878,247 1,368,978
Long-term debt, less current portion:
Senior notes 612,900 624,365
Convertible senior notes 307,663 323,667
Equipment and other loans 47,764 54,529
Atlantic Copper debt 13,841 37
----------- -----------
Total long-term debt, less current
portion 982,168 1,002,598
Accrued postretirement benefits and
other liabilities 236,710 210,259
Deferred income taxes 852,209 902,386
Minority interests 218,849 222,991
Stockholders' equity:
Convertible perpetual preferred stock 1,100,000 1,100,000
Class B common stock 30,011 29,696
Capital in excess of par value of
common stock 2,357,782 2,212,246
Retained earnings 1,202,295 (a) 1,086,191
Accumulated other comprehensive income 199 10,749
Common stock held in treasury (2,748,931) (2,595,888)
----------- -----------
Total stockholders' equity 1,941,356 1,842,994
----------- -----------
Total liabilities and stockholders'
equity $5,109,539 $5,550,206
=========== ===========

(a) On January 1, 2006, FCX adopted Emerging Issues Task Force Issue
No. 04-6, "Accounting for Stripping Costs Incurred during
Production in the Mining Industry" (EITF 04-6), which requires
that stripping costs incurred during production be considered
costs of the extracted minerals and included as a component of
inventory to be recognized in cost of sales in the same period as
the revenue from the sale of inventory. Upon adoption of EITF
04-6, FCX recorded its deferred mining costs asset ($285.4
million) at December 31, 2005, net of taxes, minority interest
share and inventory effects ($135.9 million), as a cumulative
effect adjustment to reduce its retained earnings on January 1,
2006. In addition, stripping costs incurred in 2006 and later
periods are now charged to cost of sales as incurred. Adoption of
the new guidance has no impact on FCX's cash flows.




FREEPORT-McMoRan COPPER & GOLD INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Six Months Ended June 30,
--------------------------
2006 2005
----------- -----------
(In Thousands)

Cash flow from operating activities:
Net income $ 649,155 (a) $ 335,892
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 86,605 111,085
Minority interests' share of net
income 69,160 47,888
Stock-based compensation 24,824 1,826
Long-term compensation and
postretirement benefits 10,590 9,802
Losses (gains) on early extinguishment
and conversion of debt 2,240 (37)
Deferred income taxes 63,295 5,327
Equity in PT Smelting earnings (5,565) (5,158)
Increase in deferred mining costs - (a) (52,810)(a)
(Recognition) elimination of profit
on PT Freeport Indonesia sales to
PT Smelting (12,979) 25
Provision for inventory obsolescence 3,000 3,000
Other 4,806 1,067
(Increases) decreases in working
capital:
Accounts receivable (1,790) 123,278
Inventories (218,373) 25,155
Prepaid expenses and other (2,845) (2,406)
Accounts payable and accrued
liabilities 29,655 (8,100)
Rio Tinto share of joint venture
cash flows (99,558) (334)
Accrued income taxes (226,292) 25,011
----------- -----------
(Increase) decrease in working
capital (519,203) 162,604
----------- -----------
Net cash provided by operating
activities 375,928 620,511
----------- -----------
Cash flow from investing activities:
PT Freeport Indonesia capital
expenditures (104,163) (53,428)
Atlantic Copper and other capital
expenditures (6,182) (5,863)
Sale of assets 2,887 -
Investment in PT Smelting and other (1,152) 131
Proceeds from insurance settlement - 2,016
----------- -----------
Net cash used in investing
activities (108,610) (57,144)
----------- -----------
Cash flow from financing activities:
Proceeds from debt 53,135 65,647
Repayments of debt (223,303) (235,249)
Redemption of step-up preferred stock - (215)
Purchases of FCX common shares (99,783) (80,227)
Cash dividends paid:
Common stock (352,493) (179,658)
Preferred stock (30,250) (30,251)
Minority interests (56,802)(b) (71,425)(b)
Net proceeds from exercised stock
options 13,830 2,016
Excess tax benefit from exercised
stock options 22,522 (c) -
Other (22) (21)
----------- -----------
Net cash used in financing
activities (673,166) (529,383)
----------- -----------
Net (decrease) increase in cash and cash
equivalents (405,848) 33,984
Cash and cash equivalents at beginning
of year 763,599 551,450
----------- -----------
Cash and cash equivalents at end of
period $ 357,751 $ 585,434
=========== ===========

(a) See Note a on page IV. Stripping costs are no longer deferred
and are included in net income.
(b) Represents minority ownership interests' share of PT Freeport
Indonesia and PT Puncakjaya Power dividends.
(c) Prior to adoption of SFAS 123R, these amounts would have been
classified as operating cash flows.




FREEPORT-McMoRan COPPER & GOLD INC.
PRODUCT REVENUES AND PRODUCTION COSTS

PT FREEPORT INDONESIA PRODUCT REVENUES AND UNIT NET CASH COSTS

Unit net cash costs per pound of copper is a measure intended to
provide investors with information about the cash generating capacity
of PT Freeport Indonesia's mining operations expressed on a basis
relating to its primary metal product, copper. PT Freeport Indonesia
uses this measure for the same purpose and for monitoring operating
performance by its mining operations. This information differs from
measures of performance determined in accordance with generally
accepted accounting principles and should not be considered in
isolation or as a substitute for measures of performance determined in
accordance with generally accepted accounting principles. This measure
is presented by other copper and gold mining companies, although PT
Freeport Indonesia's measures may not be comparable to similarly
titled measures reported by other companies.

PT Freeport Indonesia presents gross profit per pound of copper using
both a "by-product" method and a "co-product" method. PT Freeport
Indonesia uses the by-product method in its presentation of gross
profit per pound of copper because (1) the majority of its revenues
are copper revenues, (2) it produces and sells one product,
concentrates, which contains copper, gold and silver, (3) it is not
possible to specifically assign PT Freeport Indonesia's costs to
revenues from the copper, gold and silver it produces in concentrates,
(4) it is the method used to compare mining operations in certain
industry publications and (5) it is the method used by PT Freeport
Indonesia's management and Board of Directors to monitor its
operations. In the co-product method presentation below, costs are
allocated to the different products based on their relative revenue
values, which will vary to the extent our metals sales volumes and
realized prices change.

In both the by-product and the co-product method calculations below,
PT Freeport Indonesia shows adjustments to copper revenues for prior
period open sales as separate line items. Because the copper pricing
adjustments do not result from current period sales, PT Freeport
Indonesia has reflected these separately from revenues on current
period sales. Noncash and nonrecurring costs, which consist of items
such as stock-based compensation costs starting January 1, 2006,
write-offs of equipment or unusual charges, have not been material.
They are removed from site production and delivery costs in the
calculation of unit net cash costs. As discussed above, gold and
silver revenues are reflected as credits against site production and
delivery costs in the by-product method. Presentations under both
methods are shown below together with a reconciliation to amounts
reported in FCX's consolidated financial statements.




FREEPORT-McMoRan COPPER & GOLD INC.
PRODUCT REVENUES AND PRODUCTION COSTS
(continued)

Three Months Ended June 30, 2006
--------------------------------
Co-Product Method
By-Product -------------------------
(In Thousands) Method Copper Gold
------------ ------------ ------------
Revenues, after adjustments
shown below $741,511 $741,511 $175,763

Site production and delivery,
before net noncash and
nonrecurring costs shown below 270,904 216,458 51,308
Gold and silver credits (186,513) - -
Treatment charges 107,196 (a) 85,652 (b) 20,302 (b)
Royalty on metals 22,934 18,325 4,344
--------- --------- ---------
Unit net cash costs 214,521 320,435 75,954
Depreciation and amortization 33,910 27,095 6,422
Noncash and nonrecurring costs,
net 10,404 8,313 1,970
--------- --------- ---------
Total unit costs 258,835 355,843 84,346
Revenue adjustments, primarily
for pricing on prior period
open sales 237,274 237,274 -
PT Smelting intercompany profit
elimination (7,849) (6,271) (1,487)
--------- --------- ---------
Gross profit $712,101 $616,671 $ 89,930
========= ========= =========

Pounds of copper sold (000s) 220,100 220,100
Ounces of gold sold 278,000
Ounces of silver sold

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments
shown below $3.33 $3.33 $613.77
--------- --------- ---------

Site production and delivery,
before net noncash and
nonrecurring costs shown below 1.23 0.98 184.56
Gold and silver credits (0.85) - -
Treatment charges 0.49 (a) 0.39 (b) 73.03 (b)
Royalty on metals 0.11 0.09 15.62
--------- --------- ---------
Unit net cash costs 0.98 1.46 273.21
Depreciation and amortization 0.15 0.12 23.10
Noncash and nonrecurring costs,
net 0.05 0.04 7.09
--------- --------- ---------
Total unit costs 1.18 1.62 303.40
Revenue adjustments, primarily
for pricing on prior period
open sales 1.12 1.12 18.47
PT Smelting intercompany profit
elimination (0.03) (0.03) (5.35)
--------- --------- ---------
Gross profit per pound/ounce $3.24 $2.80 $323.49
========= ========= =========

Reconciliation to Amounts
Reported
(In Thousands) Production Depreciation
and and
Revenues Delivery Amortization
------------ ------------ ------------
Totals presented above $ 928,024 $ 270,904 $ 33,910
Net noncash and nonrecurring
costs per above N/A 10,404 N/A
Less: Treatment charges per
above (107,196) N/A N/A
Royalty per above (22,934) N/A N/A
Revenue adjustments, primarily
for pricing on prior period
open sales per above 237,274 N/A N/A
------------ ------------ ------------
Mining and exploration segment 1,035,168 281,308 33,910
Smelting and refining segment 593,134 560,375 7,410
Eliminations and other (202,100) (236,076) 2,035
------------ ------------ ------------
As reported in FCX's consolidated
financial statements $ 1,426,202 $ 605,607 $ 43,355
============ ============ ============

Three Months Ended June 30, 2006
--------------------------------
Co-Product Method
-------------------------
(In Thousands) Silver Total
------------ ------------
Revenues, after adjustments shown below $ 10,750 $928,024
Site production and delivery, before net
noncash and nonrecurring costs shown below 3,138 270,904
Gold and silver credits - -
Treatment charges 1,242 (b) 107,196
Royalty on metals 265 22,934
--------- ---------
Unit net cash costs 4,645 401,034
Depreciation and amortization 393 33,910
Noncash and nonrecurring costs, net 121 10,404
--------- ---------
Total unit costs 5,159 445,348
Revenue adjustments, primarily for pricing
on prior period open sales - 237,274
PT Smelting intercompany profit elimination (91) (7,849)
--------- ---------
Gross profit $ 5,500 $712,101
========= =========

Pounds of copper sold (000s)
Ounces of gold sold
Ounces of silver sold 835,200

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments shown below $11.74
---------
Site production and delivery, before
net noncash and nonrecurring costs shown
below 3.76
Gold and silver credits -
Treatment charges 1.49 (b)
Royalty on metals 0.32
---------
Unit net cash costs 5.57
Depreciation and amortization 0.47
Noncash and nonrecurring costs, net 0.14
---------
Total unit costs 6.18
Revenue adjustments, primarily for pricing
on prior period open sales 1.14
PT Smelting intercompany profit elimination (0.11)
---------
Gross profit per pound/ounce $6.59
=========

(a) Includes $14.4 million or $0.07 per pound for adjustments to prior
quarters' concentrate sales subject to final pricing to reflect
the impact on treatment charges resulting from the increase in
copper prices since March 31, 2006.
(b) Includes $11.5 million or $0.05 per pound for copper, $2.7 million
or $9.84 per ounce for gold and $0.2 million or $0.20 per ounce
for silver for adjustments to prior quarters' concentrate sales
subject to final pricing to reflect the impact on treatment
charges resulting from the increase in copper prices since March
31, 2006.




FREEPORT-McMoRan COPPER & GOLD INC.
PRODUCT REVENUES AND PRODUCTION COSTS
(continued)

Three Months Ended June 30, 2005
--------------------------------
Co-Product Method
By-Product -------------------------
(In Thousands) Method Copper Gold
------------ ------------ ------------
Revenues, after adjustments
shown below $480,076 $480,076 $264,040

Site production and delivery,
before net noncash and
nonrecurring costs shown below 221,071 (a) 141,221 (b) 77,671 (b)
Gold and silver credits (271,446) - -
Treatment charges 67,867 43,354 23,844
Royalty on metals 17,741 11,333 6,233
--------- --------- ---------
Unit net cash costs 35,233 195,908 107,748
Depreciation and amortization 44,217 28,246 15,535
Noncash and nonrecurring costs,
net 2,284 1,459 802
--------- --------- ---------
Total unit costs 81,734 225,613 124,085
Revenue adjustments, primarily
for pricing on prior period
open sales 12,472 12,472 -
PT Smelting intercompany profit
recognized 2,552 1,630 897
--------- --------- ---------
Gross profit $413,366 $268,565 $140,852
========= ========= =========

Pounds of copper sold (000s) 313,700 313,700
Ounces of gold sold 616,400
Ounces of silver sold

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments
shown below $1.53 $1.53 $428.23
--------- --------- ---------

Site production and delivery,
before net noncash and
nonrecurring costs shown below 0.71 (a) 0.45 (b) 126.01 (b)
Gold and silver credits (0.87) - -
Treatment charges 0.21 0.14 38.68
Royalty on metals 0.06 0.03 10.11
--------- --------- ---------
Unit net cash costs 0.11 0.62 174.80
Depreciation and amortization 0.14 0.09 25.20
Noncash and nonrecurring costs,
net 0.01 0.01 1.30
--------- --------- ---------
Total unit costs 0.26 0.72 201.30
Revenue adjustments, primarily
for pricing on prior period
open sales 0.04 0.04 0.12
PT Smelting intercompany profit
recognized 0.01 0.01 1.45
--------- --------- ---------
Gross profit per pound/ounce $1.32 $0.86 $228.50
========= ========= =========

Reconciliation to Amounts Reported
(In Thousands) Production Depreciation
and and
Revenues Delivery Amortization
------------ ------------ ------------
Totals presented above $ 751,522 $ 221,071 $ 44,217
Net noncash and nonrecurring
costs per above N/A 2,284 N/A
Less: Treatment charges per
above (67,867) N/A N/A
Royalty per above (17,741) N/A N/A
Revenue adjustments, primarily
for pricing on prior period
open sales per above 12,472 N/A N/A
------------ ------------ ------------
Mining and exploration segment 678,386 223,355 44,217
Smelting and refining segment 331,897 321,909 7,141
Eliminations and other (107,374) (154,678) 2,801
------------ ------------ ------------
As reported in FCX's consolidated
financial statements $ 902,909 $ 390,586 $ 54,159
============ ============ ============

Three Months Ended June 30, 2005
--------------------------------
Co-Product Method
-------------------------
(In Thousands) Silver Total
------------ ------------
Revenues, after adjustments shown below 7,406 $751,522

Site production and delivery, before net
noncash and nonrecurring costs shown below 2,179 (b) 221,071
Gold and silver credits - -
Treatment charges 669 67,867
Royalty on metals 175 17,741
--------- ---------
Unit net cash costs 3,023 306,679
Depreciation and amortization 436 44,217
Noncash and nonrecurring costs, net 23 2,284
--------- ---------
Total unit costs 3,482 353,180
Revenue adjustments, primarily for pricing
on prior period open sales - 12,472
PT Smelting intercompany profit recognized 25 2,552
--------- ---------
Gross profit 3,949 $413,366
========= =========

Pounds of copper sold (000s)
Ounces of gold sold
Ounces of silver sold 1,057,700

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments shown below $7.04
---------

Site production and delivery, before net
noncash and nonrecurring costs shown below 2.06 (b)
Gold and silver credits -
Treatment charges 0.63
Royalty on metals 0.17
---------
Unit net cash costs 2.86
Depreciation and amortization 0.41
Noncash and nonrecurring costs, net 0.02
---------
Total unit costs 3.29
Revenue adjustments, primarily for pricing
on prior period open sales (0.03)
PT Smelting intercompany profit recognized 0.02
---------
Gross profit per pound/ounce $3.74
=========

(a) Net of deferred mining costs totaling $20.6 million or $0.07 per
pound. Following adoption of EITF 04-6 on January 1, 2006,
stripping costs are no longer deferred. See Note a on page IV.

(b) Net of deferred mining costs totaling $13.2 million or $0.04 per
pound for copper, $7.2 million or $11.74 per ounce for gold and
$0.2 million or $0.19 per ounce for silver. See Note a above and
Note a on page IV.




FREEPORT-McMoRan COPPER & GOLD INC.
PRODUCT REVENUES AND PRODUCTION COSTS
(continued)

Six Months Ended June 30, 2006
-------------------------------
Co-Product Method
By-Product -------------------------
(In Thousands) Method Copper Gold
------------ ------------ ------------
Revenues, after adjustments
shown below $1,460,234 $1,460,234 $458,561

Site production and delivery,
before net noncash and
nonrecurring costs shown below 545,913 411,480 129,218
Gold and silver credits (477,068) - -
Treatment charges 190,839 (a) 143,844 (b) 45,172 (b)
Royalty on metals 42,869 32,312 10,147
--------- --------- ---------
Unit net cash costs 302,553 587,636 184,537
Depreciation and amortization 67,683 51,016 16,021
Noncash and nonrecurring costs,
net 22,072 16,637 5,224
--------- --------- ---------
Total unit costs 392,308 655,289 205,782
Revenue adjustments, primarily
for pricing on prior period
open sales and gold hedging 128,357 (c) 197,319 (68,962)
PT Smelting intercompany profit
recognized 12,979 9,783 3,072
--------- --------- ---------
Gross profit $1,209,262 $1,012,047 $186,889
========= ========= =========


Pounds of copper sold (000s) 445,300 445,300
Ounces of gold sold 750,500
Ounces of silver sold

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments
shown below $3.27 $3.27 $ 492.73 (d)
--------- --------- ---------

Site production and delivery,
before net noncash and
nonrecurring costs shown below 1.23 0.93 172.18
Gold and silver credits (1.07) - -
Treatment charges 0.43 (a) 0.32 (b) 60.19 (b)
Royalty on metals 0.09 0.07 13.52
--------- --------- ---------
Unit net cash costs 0.68 1.32 245.89
Depreciation and amortization 0.15 0.11 21.35
Noncash and nonrecurring costs,
net 0.05 0.04 6.96
--------- --------- ---------
Total unit costs 0.88 1.47 274.20
Revenue adjustments, primarily
for pricing on prior period
open sales 0.30 (c) 0.45 26.40
PT Smelting intercompany profit
recognized 0.03 0.02 4.09
--------- --------- ---------
Gross profit per pound/ounce $2.72 $2.27 $249.02
========= ========= =========

Reconciliation to Amounts Reported
(In Thousands) Production Depreciation
and and
Revenues Delivery Amortization
------------ ------------ ------------
Totals presented above $ 1,937,302 $ 545,913 $ 67,683
Net noncash and nonrecurring
costs per above N/A 22,072 N/A
Less: Treatment charges per
above (190,839) N/A N/A
Royalty per above (42,869) N/A N/A
Revenue adjustments, primarily
for pricing on prior period
open sales and hedging per
above 128,357 N/A N/A
------------ ------------ ------------
Mining and exploration segment 1,831,951 567,985 67,683
Smelting and refining segment 1,109,238 1,051,812 14,816
Eliminations and other (428,865) (536,275) 4,106
------------ ------------ ------------
As reported in FCX's consolidated
financial statements $ 2,512,324 $ 1,083,522 $ 86,605
============ ============ ============


Six Months Ended June 30, 2006
-------------------------------
Co-Product Method
-------------------------
(In Thousands) Silver Total
------------ ------------
Revenues, after adjustments shown below $ 18,507 $1,937,302

Site production and delivery, before net
noncash and nonrecurring costs shown below 5,215 545,913
Gold and silver credits - -
Treatment charges 1,823 (b) 190,839
Royalty on metals 410 42,869
--------- ---------
Unit net cash costs 7,448 779,621
Depreciation and amortization 646 67,683
Noncash and nonrecurring costs, net 211 22,072
--------- ---------
Total unit costs 8,305 869,376
Revenue adjustments, primarily for pricing
on prior period open sales and gold hedging - 128,357
PT Smelting intercompany profit recognized 124 12,979
--------- ---------
Gross profit $ 10,326 $1,209,262
========= =========

Pounds of copper sold (000s)
Ounces of gold sold
Ounces of silver sold 1,542,300

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments shown below $11.19
---------

Site production and delivery, before net
noncash and nonrecurring costs shown below 3.38
Gold and silver credits -
Treatment charges 1.18 (b)
Royalty on metals 0.27
---------
Unit net cash costs 4.83
Depreciation and amortization 0.42
Noncash and nonrecurring costs, net 0.14
---------
Total unit costs 5.39
Revenue adjustments, primarily for pricing
on prior period open sales 0.82
PT Smelting intercompany profit recognized 0.08
---------
Gross profit per pound/ounce $6.70
=========

(a) Includes $12.4 million or $0.03 per pound for adjustments to 2005
concentrate sales subject to final pricing to reflect the impact
on treatment charges resulting from the increase in copper prices
since December 31, 2005.
(b) Includes $9.3 million or $0.02 per pound for copper, $2.9 million
or $3.91 per ounce for gold and $0.1 million or $0.08 per ounce
for silver for adjustments to 2005 concentrate sales subject to
final pricing to reflect the impact on treatment charges resulting
from the increase in copper prices since December 31, 2005.
(c) Includes a $69.0 million or $0.16 per pound loss on the redemption
of FCX's Gold-Denominated Preferred Stock, Series II.
(d) Amount was $585.34 before a loss resulting from redemption of
FCX's Gold-Denominated Preferred Stock, Series II.




FREEPORT-McMoRan COPPER & GOLD INC.
PRODUCT REVENUES AND PRODUCTION COSTS
(continued)

Six Months Ended June 30, 2005
-------------------------------
Co-Product Method
By-Product -------------------------
(In Thousands) Method Copper Gold
------------ ------------ ------------
Revenues, after adjustments
shown below $995,096 $995,096 $515,038

Site production and delivery,
before net noncash and
nonrecurring costs shown below 414,425 (a) 270,131 (b) 139,813 (b)
Gold and silver credits (531,544) - -
Treatment charges 139,353 90,833 47,013
Royalty on metals 36,519 23,804 12,320
--------- --------- ---------
Unit net cash costs 58,753 384,768 199,146
Depreciation and amortization 91,142 59,408 30,749
Noncash and nonrecurring costs,
net 2,808 1,831 947
--------- --------- ---------
Total unit costs 152,703 446,007 230,842
Revenue adjustments, primarily
for pricing on prior period
open sales 15,016 15,016 -
PT Smelting intercompany profit
elimination (25) (16) (9)
--------- --------- ---------
Gross profit $857,384 $564,089 $284,187
========= ========= =========

Pounds of copper sold (000s) 641,800 641,800
Ounces of gold sold 1,211,700
Ounces of silver sold

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments
shown below $1.54 $1.54 $427.54
--------- --------- ---------

Site production and delivery,
before net noncash and
nonrecurring costs shown below 0.65 (a) 0.42 (b) 115.39 (b)
Gold and silver credits (0.83) - -
Treatment charges 0.21 0.14 38.80
Royalty on metals 0.06 0.04 10.17
--------- --------- ---------
Unit net cash costs 0.09 0.60 164.36
Depreciation and amortization 0.14 0.09 25.38
Noncash and nonrecurring costs,
net 0.01 0.01 0.78
--------- --------- ---------
Total unit costs 0.24 0.70 190.52
Revenue adjustments, primarily
for pricing on prior period
open sales 0.04 0.04 (2.47)
PT Smelting intercompany profit
elimination - - (0.01)
--------- --------- ---------
Gross profit per pound/ounce $1.34 $0.88 $234.54
========= ========= =========

Reconciliation to Amounts Reported
(In Thousands) Production Depreciation
and and
Revenues Delivery Amortization
------------ ------------ ------------
Totals presented above $ 1,526,640 $ 414,425 $ 91,142
Net noncash and nonrecurring
costs per above N/A 2,808 N/A
Less: Treatment charges per
above (139,353) N/A N/A
Royalty per above (36,519) N/A N/A
Revenue adjustments, primarily
for pricing on prior period
open sales per above 15,016 N/A N/A
------------ ------------ ------------
Mining and exploration segment 1,365,784 417,233 91,142
Smelting and refining segment 604,013 585,486 14,230
Eliminations and other (263,823) (247,127) 5,713
------------ ------------ ------------
As reported in FCX's consolidated
financial statements $ 1,705,974 $ 755,592 $ 111,085
============ ============ ============


Six Months Ended June 30, 2005
-------------------------------
Co-Product Method
-------------------------
(In Thousands) Silver Total
------------ ------------
Revenues, after adjustments shown below $ 16,506 $1,526,640

Site production and delivery, before net
noncash and nonrecurring costs shown below 4,481 (b) 414,425
Gold and silver credits - -
Treatment charges 1,507 139,353
Royalty on metals 395 36,519
--------- ---------
Unit net cash costs 6,383 590,297
Depreciation and amortization 985 91,142
Noncash and nonrecurring costs, net 30 2,808
--------- ---------
Total unit costs 7,398 684,247
Revenue adjustments, primarily for pricing
on prior period open sales - 15,016
PT Smelting intercompany profit elimination - (25)
--------- ---------
Gross profit $ 9,108 $857,384
========= =========

Pounds of copper sold (000s)
Ounces of gold sold
Ounces of silver sold 2,328,000

Gross profit per pound of copper/per ounce of gold and silver:
Revenues, after adjustments shown below $7.02
---------

Site production and delivery, before net
noncash and nonrecurring costs shown below 1.92 (b)
Gold and silver credits -
Treatment charges 0.65
Royalty on metals 0.17
---------
Unit net cash costs 2.74
Depreciation and amortization 0.42
Noncash and nonrecurring costs, net 0.01
---------
Total unit costs 3.17
Revenue adjustments, primarily for pricing
on prior period open sales 0.06
PT Smelting intercompany profit elimination -
---------
Gross profit per pound/ounce $3.91
=========

(a) Net of deferred mining costs totaling $52.8 million or $0.08 per
pound. Following adoption of EITF 04-6 on January 1, 2006,
stripping costs are no longer deferred. See Note a on page IV.
(b) Net of deferred mining costs totaling $34.4 million or $0.05 per
pound for copper, $17.8 million or $14.70 per ounce for gold and
$0.6 million or $0.25 per ounce for silver. See Note a above and
Note a on page IV.




FREEPORT-McMoRan COPPER & GOLD INC.
CATHODE CASH UNIT COSTS

Cathode cash unit cost per pound of copper is a measure intended to
provide investors with information about the costs incurred to produce
cathodes at FCX's smelting operations in Spain and Indonesia. FCX uses
this measure for the same purpose and for monitoring operating
performance at its smelting operations. This information differs from
measures of performance determined in accordance with generally
accepted accounting principles and should not be considered in
isolation or as a substitute for measures of performance determined in
accordance with generally accepted accounting principles. Other
smelting companies present this measure, although Atlantic Copper's
and PT Smelting's measures may not be comparable to similarly titled
measures reported by other companies.

ATLANTIC COPPER CATHODE CASH UNIT COST PER POUND OF COPPER

The reconciliation below presents reported production costs for FCX's
smelting and refining segment (Atlantic Copper) and subtracts or adds
components of those costs that do not directly relate to the process
of converting copper concentrates to cathodes. The adjusted production
costs amounts are used to calculate Atlantic Copper's cathode cash
unit cost per pound of copper (in thousands, except per pound
amounts):

Three Months Ended
June 30,
-------------------------
2006 2005
------------ ------------
Smelting and refining segment production
costs reported in FCX's consolidated
financial statements $ 560,375 $ 321,909
Less:
Raw material purchase costs (409,477) (209,199)
Production costs of anodes sold (1,524) (2,368)
Other 3,335 179
Credits:
Gold and silver revenues (118,816) (78,473)
Acid and other by-product revenues (6,279) (7,291)
------------ ------------
Production costs used in calculating cathode
cash unit cost per pound $ 27,614 $ 24,757
============ ============

Pounds of cathode produced 131,500 137,800
============ ============

Cathode cash unit cost per pound $ 0.21 $ 0.18
============ ============

Six Months Ended
June 30,
-------------------------
2006 2005
------------ ------------
Smelting and refining segment production
costs reported in FCX's consolidated
financial statements $ 1,051,812 $ 585,486
Less:
Raw material purchase costs (735,418) (406,470)
Production costs of anodes sold (6,049) (5,766)
Other 4,447 (1,034)
Credits:
Gold and silver revenues (248,859) (110,421)
Acid and other by-product revenues (12,938) (14,591)
------------ ------------
Production costs used in calculating cathode
cash unit cost per pound $ 52,995 $ 47,204
============ ============

Pounds of cathode produced 260,900 269,500
============ ============

Cathode cash unit cost per pound $ 0.20 $ 0.18
============ ============

PT SMELTING CATHODE CASH UNIT COST PER POUND OF COPPER

The calculation below presents PT Smelting's reported operating costs
and subtracts or adds components of those costs that do not directly
relate to the process of converting copper concentrates to cathodes.
PT Smelting's operating costs are then reconciled to PT Freeport
Indonesia's equity in PT Smelting earnings reported in FCX's
consolidated financial statements (in thousands, except per pound
amounts):

Three Months Ended
June 30,
-------------------------
2006 2005
------------ ------------
Operating costs - PT Smelting (100%) $ 31,438 $ 17,623
Add: Gold and silver refining charges 1,039 1,119
Less: Acid and other by-product revenues (3,666) (3,641)
Other 3,522 (400)
------------ ------------
Production costs used in calculating cathode
cash unit cost per pound $ 32,333 $ 14,701
============ ============

Pounds of cathode produced 127,300 146,100
============ ============

Cathode cash unit cost per pound $ 0.25 $ 0.10
============ ============

Reconciliation to Amounts Reported
Operating costs per above $ (31,438) $ (17,623)
Other costs (528,549) (312,792)
Revenue and other income 568,252 340,904
------------ ------------
PT Smelting net income 8,265 10,489

PT Freeport Indonesia's 25% equity interest 2,066 2,622
Amortization of excess investment cost (60) (60)
------------ ------------
Equity in PT Smelting earnings reported in
FCX's consolidated financial statements $ 2,006 $ 2,562
============ ============

Six Months Ended
June 30,
-------------------------
2006 2005
------------ ------------
Operating costs - PT Smelting (100%) $ 55,404 $ 36,074

Add: Gold and silver refining charges 2,505 2,075

Less: Acid and other by-product revenues (7,402) (7,502)
Other 1,922 (898)
------------ ------------
Production costs used in calculating cathode
cash unit cost per pound $ 52,429 $ 29,749
============ ============

Pounds of cathode produced 269,700 289,600
============ ============

Cathode cash unit cost per pound $ 0.19 $ 0.10
============ ============

Reconciliation to Amounts Reported
Operating costs per above $ (55,404) $ (36,074)
Other costs (1,000,584) (590,943)
Revenue and other income 1,078,729 648,130
------------ ------------
PT Smelting net income 22,741 21,113

PT Freeport Indonesia's 25% equity interest 5,685 5,278
Amortization of excess investment cost (120) (120)
------------ ------------
Equity in PT Smelting earnings reported in
FCX's consolidated financial statements $ 5,565 $ 5,158
============ ============




FREEPORT-McMoRan COPPER & GOLD INC.
PROVISION FOR INCOME TAXES

PROVISION FOR INCOME TAXES

PT Freeport Indonesia's Contract of Work provides for a 35 percent
corporate income tax rate. PT Indocopper Investama (100 percent owned
by FCX) pays a 30 percent corporate income tax on dividends it
receives from its 9.36 percent ownership in PT Freeport Indonesia. In
addition, the tax treaty between Indonesia and the United States
(U.S.) provides for a withholding tax rate of 10 percent on dividends
and interest that PT Freeport Indonesia and PT Indocopper Investama
pay to their parent company, FCX. FCX currently records no income
taxes at Atlantic Copper, which is subject to taxation in Spain,
because it has not generated significant taxable income in recent
years and has substantial tax loss carryforwards for which FCX has
provided no net financial statement benefit. FCX receives no
consolidated tax benefit from these losses because they cannot be used
to offset PT Freeport Indonesia's profits in Indonesia, but can be
utilized to offset Atlantic Copper's future profits.

Parent company costs consist primarily of interest, depreciation and
amortization, and general and administrative expenses. FCX receives
minimal, if any, tax benefit from these costs, including interest
expense, primarily because the parent company normally generates no
taxable income from U.S. sources. As a result, FCX's provision for
income taxes as a percentage of its consolidated income before income
taxes and minority interests will vary as PT Freeport Indonesia's
income changes, absent changes in Atlantic Copper and parent company
costs. Summaries of the approximate significant components of the
calculation of FCX's consolidated provision for income taxes are shown
below (in thousands, except percentages).

Three Months Ended
June 30,
-------------------------
2006 2005
------------ ------------
Mining and exploration segment operating
income(a) $ 690,977 $ 390,780
Mining and exploration segment interest
expense, net (1,608) (5,897)
Intercompany operating profit recognized
(deferred) 34,208 48,350
------------ ------------
Income before taxes 723,577 433,233
Indonesian corporate income tax rate 35% 35%
------------ ------------
Corporate income taxes 253,252 151,632

Approximate PT Freeport Indonesia net income 470,325 281,601
Withholding tax on FCX's equity share 9.064% 9.064%
------------ ------------
Withholding taxes 42,630 25,524

PT Indocopper Investama corporate income tax 11,247 6,957
Other, net 3,115 4,571
------------ ------------
FCX consolidated provision for income taxes $ 310,244 $ 188,684
============ ============

FCX consolidated effective tax rate 42% 46%
============ ============

Six Months Ended
June 30,
-------------------------
2006 2005
------------ ------------
Mining and exploration segment operating
income(a) $ 1,138,504 $ 819,087
Mining and exploration segment interest
expense, net (4,881) (11,624)
Intercompany operating profit recognized
(deferred) 108,419 (15,220)
------------ ------------
Income before taxes 1,242,042 792,243
Indonesian corporate income tax rate 35% 35%
------------ ------------
Corporate income taxes 434,715 277,285

Approximate PT Freeport Indonesia net income 807,327 514,958
Withholding tax on FCX's equity share 9.064% 9.064%
------------ ------------
Withholding taxes 73,176 46,676

PT Indocopper Investama corporate income tax 16,870 21,081
Other, net 7,205 7,670
------------ ------------
FCX consolidated provision for income taxes $ 531,966 $ 352,712
============ ============

FCX consolidated effective tax rate 43% 48%
============ ============

(a) Excludes charges for the in-the-money value of FCX stock option
exercises, which are eliminated in consolidation, totaling $29.4
million for the 2006 quarter, $0.7 million for the 2005 quarter,
$85.5 million for the 2006 six-month period and $17.4 million for
the 2005 six-month period.




FREEPORT-McMoRan COPPER & GOLD INC.
BUSINESS SEGMENTS

BUSINESS SEGMENTS

FCX has two operating segments: "mining and exploration" and "smelting
and refining." The mining and exploration segment consists of FCX's
Indonesian activities including PT Freeport Indonesia's copper and
gold mining operations, PT Puncakjaya Power's power-generating
operations (after eliminations with PT Freeport Indonesia) and FCX's
Indonesian exploration activities. The smelting and refining segment
includes Atlantic Copper's operations in Spain and PT Freeport
Indonesia's equity investment in PT Smelting in Gresik, Indonesia.
The segment data presented below were prepared on the same basis as
FCX's consolidated financial statements.

Mining Smelting
and and
Exploration Refining
-------------- --------------
(In Thousands)

Three months ended June 30, 2006:
Revenues $1,035,168 (a) $ 593,134
Production and delivery 281,308 560,375
Depreciation and amortization 33,910 7,410
Exploration expenses 2,709 -
General and administrative expenses 55,689 (c) 3,529
----------- -----------
Operating income $ 661,552 $ 21,820
=========== ===========
Equity in PT Smelting earnings $ - $ 2,006
=========== ===========
Interest expense, net $ 1,608 $ 4,824
=========== ===========
Provision for income taxes $ 237,001 $ -
=========== ===========
Capital expenditures $ 56,392 $ 2,669
=========== ===========
Total assets $3,890,148 (d) $1,035,415 (e)
=========== ===========

Three months ended June 30, 2005:
Revenues $ 678,386 (a) $ 331,897
Production and delivery 223,355 321,909
Depreciation and amortization 44,217 7,141
Exploration expenses 2,272 -
General and administrative expenses 18,425 (c) 2,901
----------- -----------
Operating income (loss) $ 390,117 $ (54)
=========== ===========
Equity in PT Smelting earnings $ - $ 2,562
=========== ===========
Interest expense, net $ 5,897 $ 4,387
=========== ===========
Provision for income taxes $ 138,007 $ -
=========== ===========
Capital expenditures $ 29,939 $ 3,139
=========== ===========
Total assets $3,870,969 (d) $ 717,707 (e)
=========== ===========

Six months ended June 30, 2006:
Revenues $1,831,951 (a) $1,109,238
Production and delivery 567,985 1,051,812
Depreciation and amortization 67,683 14,816
Exploration expenses 5,246 -
General and administrative expenses 137,995 (c) 7,304
----------- -----------
Operating income $1,053,042 $ 35,306
=========== ===========
Equity in PT Smelting earnings $ - $ 5,565
=========== ===========
Interest expense, net $ 4,881 $ 10,271
=========== ===========
Provision for income taxes $ 381,692 $ -
=========== ===========
Capital expenditures $ 105,332 $ 6,182
=========== ===========

Eliminations
and Other FCX Total
-------------- --------------
(In Thousands)

Three months ended June 30, 2006:
Revenues $ (202,100) $1,426,202
Production and delivery (236,076)(b) 605,607
Depreciation and amortization 2,035 43,355
Exploration expenses 69 2,778
General and administrative expenses (24,083)(c) 35,135
----------- -----------
Operating income $ 55,955 $ 739,327
=========== ===========
Equity in PT Smelting earnings $ - $ 2,006
=========== ===========
Interest expense, net $ 14,592 $ 21,024
=========== ===========
Provision for income taxes $ 73,243 $ 310,244
=========== ===========
Capital expenditures $ (838) $ 58,223
=========== ===========
Total assets $ 183,976 $5,109,539
=========== ===========

Three months ended June 30, 2005:
Revenues $ (107,374) $ 902,909
Production and delivery (154,678)(b) 390,586
Depreciation and amortization 2,801 54,159
Exploration expenses 70 2,342
General and administrative expenses 4,053 (c) 25,379
----------- -----------
Operating income (loss) $ 40,380 $ 430,443
=========== ===========
Equity in PT Smelting earnings $ - $ 2,562
=========== ===========
Interest expense, net $ 25,008 $ 35,292
=========== ===========
Provision for income taxes $ 50,677 $ 188,684
=========== ===========
Capital expenditures $ (33) $ 33,045
=========== ===========
Total assets $ 369,588 $4,958,264
=========== ===========

Six months ended June 30, 2006:
Revenues $ (428,865) $2,512,324
Production and delivery (536,275)(b) 1,083,522
Depreciation and amortization 4,106 86,605
Exploration expenses 108 5,354
General and administrative expenses (79,533)(c) 65,766
----------- -----------
Operating income $ 182,729 $1,271,077
=========== ===========
Equity in PT Smelting earnings $ - $ 5,565
=========== ===========
Interest expense, net $ 28,543 $ 43,695
=========== ===========
Provision for income taxes $ 150,274 $ 531,966
=========== ===========
Capital expenditures $ (1,169) $ 110,345
=========== ===========




FREEPORT-McMoRan COPPER & GOLD INC.
BUSINESS SEGMENTS
(continued)

Mining Smelting
and and
Exploration Refining
-------------- --------------
(In Thousands)

Six months ended June 30, 2005:
Revenues $1,365,784 (a) $ 604,013
Production and delivery 417,233 585,486
Depreciation and amortization 91,142 14,230
Exploration expenses 4,164 -
General and administrative expenses 51,607 (c) 5,905
----------- -----------
Operating income (loss) $ 801,638 $ (1,608)
=========== ===========
Equity in PT Smelting earnings $ - $ 5,158
=========== ===========
Interest expense, net $ 11,624 $ 8,192
=========== ===========
Provision for income taxes $ 283,326 $ -
=========== ===========
Capital expenditures $ 53,508 $ 5,863
=========== ===========

Eliminations
and Other FCX Total
-------------- --------------
(In Thousands)

Six months ended June 30, 2005:
Revenues $ (263,823) $1,705,974
Production and delivery (247,127) 755,592
Depreciation and amortization 5,713 111,085
Exploration expenses 98 4,262
General and administrative expenses (10,519)(c) 46,993
----------- -----------
Operating income (loss) $ (11,988) $ 788,042
=========== ===========
Equity in PT Smelting earnings $ - $ 5,158
=========== ===========
Interest expense, net $ 53,024 $ 72,840
=========== ===========
Provision for income taxes $ 69,386 $ 352,712
=========== ===========
Capital expenditures $ (80) $ 59,291
=========== ===========

(a) Includes PT Freeport Indonesia's sales to PT Smelting totaling
$325.4 million in the 2006 quarter, $194.9 million in the 2005
quarter, $607.9 million in the 2006 six-month period and $429.0
million in the 2005 six-month period.
(b) Includes deferral (recognition) of intercompany profits on 25
percent of PT Freeport Indonesia's sales to PT Smelting, for which
the final sale to third parties has not occurred, totaling $7.8
million in the 2006 quarter, $(2.6) million in the 2005 quarter
and $(13.0) million in the 2006 six-month period.
(c) Includes charges to the mining and exploration segment for the
in-the-money value of FCX stock option exercises which are
eliminated in consolidation totaling $29.4 million in the 2006
quarter, $0.7 million in the 2005 quarter, $85.5 million in the
2006 six-month period and $17.4 million in the 2005 six-month
period.
(d) Includes PT Freeport Indonesia's trade receivables with PT
Smelting totaling $257.6 million at June 30, 2006, and $71.9
million at June 30, 2005.

(e) Includes PT Freeport Indonesia's equity investment in PT Smelting
totaling $40.6 million at June 30, 2006, and $52.9 million at June
30, 2005.