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History
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The company was founded as the Texas Freeport
Sulphur Company in 1912 as a sulfur mining company in Freeport, Texas. In
1928, concerned that the management of the company was not moving
aggressively to increase reserves, 25-year old investor Langbourne Meade
Williams, Jr. collaborated with Payne Whitney to launch a proxy fight and
gain control of the company. Freeport pioneered mining sulphur at mines
along the US Gulf Coast using the Frasch Process. The company began to
diversify in 1931, purchasing manganese deposits in Oriente Province, Cuba.
The company produced nickel during World War II and potash in the 1950s. In
1955, Freeport invested $119 million in constructing a nickel-cobalt mine
at Moa Bay, Cuba, and a refinery at Port Nickel, Louisiana. On March 11,
1957, the U.S. government announced a contract to buy Freeport nickel and
cobalt from Cuba until June 30, 1965, as strategic commodities. Fidel
Castro's government nationalized the Cuban facility in 1960. In 1956, the
company formed Freeport Oil Company. In 1958, the company sold an oil
discovery near Lake Washington in Louisiana for approximately $100 million
to Magnolia Petroleum Company. In 1961, the company entered the kaolin
business after purchasing the assets of Southern Clays Inc. In 1964, the
company formed Freeport of Australia to pursue mining opportunities there
and in the surrounding Pacific Ocean region. In 1966, Freeport founded
Freeport Indonesia, Inc. The subsidiary negotiated a contract with the
Indonesian government to develop the Ertsberg deposit. In their feasibility
study, Freeport geologists estimated that the orebody totaled 33 million
tons averaging 2.5% copper. The Ertsberg was the largest above-ground
copper deposit ever discovered. Construction of an open pit mine began in
May 1970 and in mid-1973 the mine was declared fully operational. Officials
at Bechtel, the primary project contractor, called mine development at
Ertsberg "the most difficult engineering project they had ever
undertaken." The challenges included building a 63 mile long access
road (a project that required boring long tunnels through two mountains)
and constructing the world's longest single span aerial tramway. The
tramways were needed to move people, supplies and ore because a 2,000 feet
cliff separates the Ertsberg mine (at 12,000 feet elevation) from the mill
(at 10,000 feet). Moving copper concentrate from that mill to the shipping
port required installation of a 68 mile slurry pipeline — then the world's
longest. Mine construction and startup cost about $200 million. The
Ertsberg project was an engineering marvel, but the mine's early financial
performance was disappointing. Depressed copper prices and high operating
costs kept profits marginal during the 1970s. In 1971, the company changed
its name to Freeport Minerals Company to reflect its role as a diversified
mineral producer. In 1981, Freeport Minerals Company merged with the
McMoRan Oil and Gas Company. The McMoRan Oil and Gas Company was founded in
1967 by three partners, William Kennon McWilliams Jr. ("Mc"),
James Robert (Jim Bob) Moffett ("Mo"), who were both petroleum
geologists, and Byron McLean Rankin, Jr. ("Ran"), "a
specialist in land-leasing and sales operations." Kent McWilliams
(died 1997) was as knowledgeable of the micro-paleontology of the Louisiana
and Texas coasts as any geologist of the twentieth century. McMoRan's
incredible record in hitting paydirt was based on the fundamental
petro-geological learning of the founder and the young geologist he began
mentoring in the early 1960s. In 1994, Freeport-McMoRan spun off its entire
interest in Freeport-McMoRan Copper & Gold, which became an independent
company, fully focused on the Indonesian operation. Notable historical
members of the board of directors have included: John Hay Whitney (Kidder,
Peabody & Co.), Chauncey Stillman, Godfrey Stillman Rockefeller,
Augustus Long, Robert A. Lovett, Jean Mauzé, Henry Kissinger, and George
Putnam (Putnam Investments).
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