Production from PT Freeport Indonesia’s Deep Ore Zone  (DOZ) underground mine averaged 43,600 metric tons  of ore per day in 2004. DOZ operations continued for a  second straight year to perform above design capacity,  which is being increased to a sustainable level of 50,000  metric tons per day through a high-return capital project  to install a second underground crusher and additional  ventilation. The DOZ block cave mine is one of the world’s  largest underground operations. Mill throughput increased throughout 2004 as we  made progress on our waste removal efforts, averaging  185,100 metric tons of ore per day during 2004, including  a fourth-quarter average of approximately 230,000  metric tons of ore per day. Mill throughput, which varies  depending on ore types processed, is expected to average  approximately 235,000 metric tons per day in 2005.  Copper ore grades from the PT Freeport Indonesia  operations averaged 0.87 percent for the full year 2004,  compared with 1.09 percent for 2003. Gold ore averaged  0.88 grams per metric ton, compared with 1.54 grams  per metric ton in the previous year. Grades were higher  in the fourth quarter (1.17 percent for copper and 1.20  grams per metric ton for gold) and are expected to be  significantly higher in 2005 than 2004 levels. Our operations team continues its efforts to improve  productivity of our mining, milling and maintenance  activities. Programs are under way, in coordination with  our partners and contractors, to improve performance  involving safety, equipment availability, drilling  efficiency, pit road maintenance, logistics and other  areas that are part of our continual improvement and  operations excellence programs. In addition, work  commenced in 2004 on new portals and tunnel systems  as part of common infrastructure which will provide for  future development of underground operations and enable  us to expand exploratory drilling activities. PT Freeport Indonesia’s unit net cash production  costs, including gold and silver credits, averaged $0.40  per pound for 2004, compared to a net credit of ($0.02)  in 2003. This increase was primarily the result of lower  sales volumes, and to a lesser extent higher energy  costs, increased maintenance costs, the impact of a  stronger Australian dollar and increased treatment and  refining costs resulting from higher copper prices. Cash  production costs for the fourth quarter of 2004 averaged  $0.17 per pound of copper. Because of the fixed nature  of most of PT Freeport Indonesia’s costs and the effect  of higher sales volumes in 2005, PT Freeport Indonesia  estimates that in 2005 unit net cash production costs will  be significantly lower than in 2004. Assuming an average  price of $420 per ounce for gold, gold credits are expected  to essentially offset cash production costs for the year,  resulting in a net cash production cost of zero cents per  pound of copper. Original 1998 Feasibility Study  Actual (00-04)/Current Projections (05-09) 10 20 30 40 50 09 08 07 06 05 04 03 02 01 00 50 100 150 200 250 4Q04 3Q04 2Q04 1Q04 2004 ANNUAL REPORT  | 5 DOZ Block Cave Production:  Original Feasibility v. Actual/Projected Quarterly Mill Throughput in thousands of metric tons per day in thousands of metric tons per day