*

World's top copper producer focuses on expanding current

assets

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Leaching copper to cost a third less than hard rock mining

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Leaching to boost output by 800 million pounds annually as

soon

as 2027

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Expansion projects in U.S., Indonesia, Chile to add over 1

bln

pounds annually

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Freeport's stock up 30% as investors back expansion plans

By Ernest Scheyder

Sept 29 (Reuters) -

Freeport-McMoRan ( FCX ) is turbo-charging its copper output

across three continents with no plans to join a buyout frenzy

sweeping the mining industry, a strategy that analysts say

positions the company well to capitalize on the clean energy

transition's rising demand for the red metal.

Used widely across the global economy, copper is an ideal

conductor of electricity and easily malleable, qualities that

have made it widely popular for use in wiring, engines,

construction equipment, electronics and other devices.

Global demand is poised to jump at least 60% by 2050,

according to the International Energy Agency. Analysts at

Jefferies expect prices for the red metal to rise more

than 40% in the next two years.

Yet new copper mines are proving difficult to develop,

due in part to opposition from Indigenous groups,

conservationists, local communities and others.

The difficult backdrop has pushed BHP, Rio Tinto

, Glencore ( GLCNF ) and other diversified miners of iron

ore, nickel and other critical minerals to hunt for deals to

boost their copper output even while balancing shareholders'

expectations for payouts.

Phoenix-based Freeport has long focused primarily on copper

- it produces 9% of global supplies, more than any other company

- and now finds itself in the rare position of being able to

concentrate on expanding mines it already owns and avoiding the

distraction of a buyout.

"We're really, really focused on creating value from the

assets that we have," Kathleen Quirk, who became Freeport's CEO

in June, told Reuters ahead of the LME Week conference in

London, one of the world's largest annual gatherings of mining

executives. "I don't see Freeport as having to aggressively go

out and have to overpay for things."

Freeport expects to produce 800 million pounds (362,874

metric tons) of copper annually as soon as 2027 by leaching the

metal from piles of old waste rock at its U.S. mines previously

thought to be worthless.

Drones and helicopters have been installing irrigation lines

atop miles-long waste piles that release an acid solution to

tease out low concentrations of copper.

The leached copper will cost a third less to produce than

Freeport's hard rock mines - already some of the cheapest in the

industry, according to analysts - and will not require a smelter

for processing. Freeport estimates it would need to spend at

least $10 billion on a new mine to mimic output from leaching.

"It's a huge opportunity for us and one that we're pursuing

aggressively," Quirk said.

That leaching plan alone would produce nearly half the

copper that Anglo American - which BHP tried

unsuccessfully to buy earlier this year - mined across the

entire globe in 2023.

'STICK TO THEIR KNITTING'

Freeport has four other expansion projects underway that

could add more than 1 billion pounds (453,592 metric tons) of

copper annually to its production in coming years, including

more than 500 million pounds (226,796 metric tons) annually by

2025 in the United States.

Another is in Indonesia, where it is expanding Grasberg, the

world's second-largest copper mine. Freeport is also hoping to

negotiate an extension of its mining rights beyond 2041 with the

new Indonesian president, who takes office next month.

The company is preparing its application now to extend the

license and Chairman Richard Adkerson - who led the last round

of negotiations when he was CEO - plans to join the discussions,

Quirk said.

"Indonesia is part of the fabric of our company as we've

been working hard to improve the livelihood of the people,

provide benefits to the government, all while providing returns

on investments for our shareholders," she said. "I want to

continue that positive relationship."

In Chile, Quirk said the regulatory climate has improved

under President Gabriel Boric after a period of uncertainty

fueled by an unsuccessful attempt to change the country's

constitution last year.

"Chile is a more stable environment for investors now," said

Quirk. An application to expand the El Abra mine, which counts

state-owned Codelco as a minority partner, should by filed next

year, she said.

Freeport's stock has risen 30% the past year as investors

have warmed to the company's plans to expand existing

operations. Seventeen of the 24 analysts that track Freeport's

stock recommend buying it and none recommend selling, according

to LSEG Workspace.

"Freeport is a workhorse in my portfolio," said Derek Bone

of the Optica Rare Earths & Critical Materials ETF,

which holds shares of Freeport. "I want them to stick to their

knitting."

Quirk, who had been Adkerson's deputy for more than 20

years, is facing a challenge recruiting workers in the United

States, where the company has moved as a result to deploy

autonomous trucks.

"I'm hoping that with everybody focused on our future

economy and how it will require more use of metals, we'll get

the best and brightest into our industry to help us," said

Quirk.

That is top of mind for Freeport's customers, who are

gobbling up more copper.

Nvidia ( NVDA ), for example, said in March it would use

copper cables for AI data centers - rather than fiber optic

cables.

"That bodes well for copper demand over the longer term,"

said Steve Schoffstall of the Sprott Energy Transition Materials

ETF, which holds Freeport shares. "Companies like

Freeport are in a good spot."