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Freeport CEO: 4Q Production Outlook Assumes Strike Continues
Oct 20,2011 09:41CST
industry news
Source:SMM
Forecasts of lower copper and gold sales for 2011 assume the strike at its massive Grasberg copper and gold mine continue through the rest of the year.

NEW YORK, Oct 19, 2011 (Dow Jones) --Freeport McMoRan Copper & Gold Inc.'s (FCX) chief executive said forecasts of lower copper and gold sales for 2011 assume the strike at its massive Grasberg copper and gold mine continue through the rest of the year.

"Our hope is that we get the strike resolved and we get everybody back to work," Richard Adkerson said on the company's third-quarter earnings call Wednesday.

However, when projecting copper and gold output for the year, the company assumed the strike at the Indonesian mine would continue.

Freeport expects to lose 100 million pounds of copper and 100,000 ounces of gold production this year due to strikes at the mine. Grasberg workers went on strike for eight days in July.

"Most of the gold impact was actually in the third quarter," said Kathleen Quirk, Freeport's chief financial officer. She said about 70 million pounds of copper output has been lost due to strikes so far, "that leaves about 30 million pounds' impact in the fourth quarter."

The Grasberg mine has been operating at around two-thirds capacity despite the strike, Adkerson said, adding that the forecast "assumes that we're doing what we're doing now."

The strike began Sept. 15 when workers demanded at least an eightfold increase in the minimum wage, which is $1.50 an hour now.

 

strike;copper production

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