Freeport bets $4.5 billion on Arizona copper with Bagdad expansion

Freeport-McMoRan (NYSE: FCX) will spend $4.5 billion to more than double mining and milling rates at its Bagdad copper-molybdenum operation in northwest Arizona, after its board approved the project on Wednesday.

The brownfield expansion would lift Bagdad's long-term copper output to more than 400 million pounds a year, an increase of about 225 million pounds, the Phoenix-based miner said. Molybdenum production would rise to more than 20 million pounds a year, up 12 million pounds. Freeport says the expansion would make Bagdad the second-largest copper mine in the US, behind its own Morenci operation.

Construction is expected to take about three and a half years, with first production from the expansion targeted for mid-2030. A new concentrator would add about 115,000 tons a day of nameplate processing capacity, supported by a new primary crusher, overland conveyor, water pipeline and power line.

Freeport puts the project's break-even at a copper price of about $4.00 a pound, assuming $20-a-pound molybdenum. It expects long-term unit net cash costs at Bagdad to fall by about 20%, helped by scale, automation and molybdenum by-product credits.

"This low-risk brownfield project builds on Bagdad's substantial reserve base, long operating history, existing infrastructure and experienced workforce to deliver new U.S. copper and molybdenum production," chief executive Kathleen Quirk said in the company's statement.

The spending will be classified as discretionary under Freeport's financial policy. About 20% of the cost is expected to fall in 2027, 30% to 35% in 2028 and the balance in 2029 and 2030. The company cautioned that inflation and cost escalation could affect the estimate.

Freeport shares were up 0.7% at $62.23 in New York at 12:59 p.m. ET, after touching $64.09 earlier in the session.

Import reliance

The decision lands as Washington uses tariffs to push more copper production onshore. The US relied on imports for about 57% of its refined copper consumption last year, according to US Geological Survey estimates cited by the Congressional Research Service.

President Donald Trump imposed 50% Section 232 tariffs on imported semi-finished copper products from Aug. 1, 2025, while exempting ores, concentrates, cathodes and anodes. The Commerce Secretary also recommended a phased tariff on refined copper of 15% in 2027 and 30% in 2028, a decision the president has yet to take, according to the Congressional Research Service.

Freeport's release does not tie the Bagdad decision to trade policy, though it lists tariff uncertainty among the risks to its forecasts.

Bagdad has operated since 1945 and has a reserve life of more than 80 years before counting additional resources, the company said. In 2025 it became the first major US mine to run a fully autonomous haulage fleet, and Freeport expects the expansion to create more than 4,000 direct and indirect jobs during construction.