Repairs to PT Freeport Indonesia's (PTFI) new smelter in Eastern Java, Indonesia, following the October 2024 fire incident, are nearing completion. Startup activities are expected to re-commence in second-quarter 2025 with full ramp-up expected to be achieved by year-end 2025.

PTFI continues to ramp-up production at its newly commissioned precious metals refinery (PMR) and the facility is expected to reach full capacity rates during 2025. Following the full ramp-up of the new smelter and PMR (collectively, PTFI's new downstream processing facilities), PTFI's mining and smelting operations will be fully integrated.

We are advancing pre-feasibility studies in the Safford/Lone Star district to define a potential significant expansion opportunity. Positive drilling conducted in recent years indicates a large, mineralized district with opportunities to pursue a further expansion project. We expect to complete these studies in 2026.

Incremental copper production from these initiatives totaled 214 million pounds for the year 2024 and 46 million pounds in first-quarter 2025. We are targeting an annual run rate of 300 million pounds of copper by the end of 2025 from these initiatives.

In March 2025, PTFI paid $59 million for an administrative fine that was previously assessed by the Indonesia government for delays in smelter development. The fine was fully accrued at year-end 2024.

We closely monitor market conditions and will adjust our operating plans, including capital expenditures, as necessary.

On February 25, 2025, the President issued an executive order instructing the U.S. Secretary of Commerce to conduct an investigation under Section 232 of the Trade Expansion Act to determine the effects of copper imports on U.S. national security, which could lead to tariffs, export controls, or incentives.

Based on current supply chains and discussions with suppliers, the proposed tariffs announced to date could have the potential to increase the costs of goods purchased in the U.S. by approximately 5%, primarily reflecting the potential pass-through of tariffs incurred by suppliers.

Effective March 1, 2025, the Indonesia government implemented a new regulation that requires 100% of export proceeds to be deposited in Indonesia banks for 12 months, which could affect the company's liquidity and financial flexibility.

During first-quarter 2025, our average U.S. copper price realization, which is generally based on the COMEX settlement price, was approximately 6% higher than the average copper price realizations for our South America and Indonesia operations, which are based on the LME settlement price.

We believe fundamentals for copper are favorable with growing demand supported by copper's critical role in the global transition to renewable power, electric vehicles and other carbon-reduction initiatives, continued urbanization in developing countries, data centers and artificial intelligence developments and growing connectivity globally.

We are the leading copper supplier in the U.S., providing approximately 70% of total U.S. refined copper production through our integrated domestic mining and processing facilities.

Average unit net cash costs (net of by-product credits) for our U.S. copper mines of $3.11 per pound of copper in first-quarter 2025 were higher than average unit net cash costs of $2.98 per pound in first-quarter 2024, primarily reflecting higher labor costs and lower copper volumes.

Average unit net cash costs (net of by-product credits) for South America operations of $2.40 per pound of copper in first-quarter 2025 were lower than first-quarter 2024 average unit net cash costs of $2.60 per pound, primarily reflecting higher by-product credits and lower treatment charges, partly offset by lower copper volumes.

We continue to drive initiatives to improve our U.S. cost structure through efficiency programs, cost reduction initiatives and our leach innovation projects.

We are accelerating initiatives across our U.S. and South America operations by incorporating new applications, technologies and data analytics to our leaching processes. Incremental copper production from these initiatives totaled 214 million pounds for the year 2024 and 46 million pounds in first-quarter 2025.

We are targeting an annual run rate of 300 million pounds of copper by the end of 2025 from these initiatives and believe we have the potential for further significant increases in recoverable metal beyond the current target run rate.

In addition to technology-driven leaching initiatives, we are pursuing opportunities to leverage new technologies and analytic tools in automation and operating practices with a goal of improving operating efficiencies, and reducing costs and capital intensity of our current operations and future development projects.

In first-quarter 2025, we acquired 1.4 million shares of our common stock for a total cost of $55 million ($39.10 average cost per share). As of April 30, 2025, we acquired a total of 51 million shares ($38.50 average cost per share) and have $3.0 billion available under our share repurchase program.

On March 26, 2025, our Board declared cash dividends totaling $0.15 per share on our common stock (including a $0.075 per share quarterly base cash dividend and a $0.075 per share quarterly variable, performance-based cash dividend), which were paid on May 1, 2025.

Capital expenditures, including capitalized interest, totaled $1.2 billion in first-quarter 2025 and $1.3 billion in first-quarter 2024. Capital expenditures include amounts for major mining projects ($0.6 billion in first-quarter 2025 and $0.4 billion in first quarter 2024), primarily associated with underground development activities in the Grasberg minerals district, and for PTFI's new downstream processing facilities ($0.2 billion in first-quarter 2025 and $0.5 billion in first-quarter 2024.)

In April 2025, we published our 2024 Annual Report on Sustainability, marking our 24th year of reporting on our progress. We are committed to building upon our achievements in sustainability and our position as a leading responsible copper producer.

We demonstrate our responsible production performance through the Copper Mark, a comprehensive assurance framework developed specifically for the copper industry and extended to other metals, including molybdenum.

PTFI plans to transition its existing energy source from coal to natural gas, which would meaningfully reduce PTFI's greenhouse gas emissions at the Grasberg minerals district. The majority of PTFI's planned investments in a new gas-fired combined cycle facility are expected to be incurred over the next three years at a cost of approximately $1 billion.

Economic uncertainty, geopolitical tensions and strong demand from central banks around the world continue to drive gold prices to record highs. The London PM gold price was $3,302 per ounce on April 30, 2025.

The recent spread between LME and COMEX copper prices, which widened during first-quarter 2025, is primarily driven by market expectations of a potential tariff on U.S. copper imports.

We believe fundamentals for copper are favorable with growing demand supported by copper's critical role in the global transition to renewable power, electric vehicles and other carbon-reduction initiatives, continued urbanization in developing countries, data centers and artificial intelligence developments and growing connectivity globally.