Staying “laser focused” on executing safe production plans is vital to the company’s continued success as it faces challenges that include a tight labor market and global economic uncertainty, said Josh Olmsted, President and Chief Operating Officer-Americas, during a recent virtual town hall with employees.
A lot goes into that overarching objective of achieving safe production goals, things like hiring, training and retaining skilled workers and pursuing important work like the various reliability and maintenance projects in the queue, Olmsted said.
Most important is adherence to safety. The company’s focus on safety produced success in the fourth quarter of 2022 after an alarming spike in injuries earlier in the year. The number of reportable injuries in the Americas dropped to 30 in December from 38 in October, which is better but still not acceptable, he said.
“The trend is in the right direction, but ultimately there’s still work to do there,” Olmsted said in stressing the importance of individuals taking responsibility for the safety of themselves and their co-workers. “I am proud of the effort by everybody to make that impact, to really focus on the things that are most important. Obviously, safety is at the top of that list.”
Olmsted was joined by Steve Higgins, Senior Vice President and Chief Administrative Officer, and David Elliott, President, Freeport-McMoRan Sales Co., who said the outlook for copper demand remains “very strong” despite price volatility in 2022.
The town hall was live streamed to more than 2,400 employees who submitted over 100 questions. The questions chosen to be answered applied to a broad base of employees in North and South America.
Strategic themes outline priorities
In explaining how to achieve the overall objective of executing safe production plans, Olmsted laid out four strategic themes for the year. Two of the themes focus on continuing the rollout of Leach to the Last Drop, which will allow the company to tap billions of pounds of unrecovered copper in existing leach piles; and ensuring the fundamentals of a solid maintenance plan – planning, resources, execution and continuous improvement – are in place.
Two other strategic themes deal with staffing issues: hiring and retaining workers, and development of frontline employees and supervisors. In fact, much of the discussion during the question-and-answer session that followed the opening comments had to do with what the company is doing to attract and retain employees.
It’s a tight labor market overall, but it’s particularly tough to find new workers at certain mine sites that also have limited housing options, Olmsted said. That includes Bagdad, Morenci and the Colorado sites, which are using innovative approaches to find fixes to help attract and retain employees.
When a new worker is hired, the company needs to ensure the onboarding process is smooth, and that the employee receives the training and assistance necessary to succeed. The company’s data shows that if a new hire stays for a year, chances favor that person becoming a long-term employee, Olmsted said.
For frontline workers and supervisors, the company will provide training, coaching and mentoring that will help them develop the skills they need to continue advancing their careers. Meanwhile, it’s incumbent on employees to do their part, driving their own personal development and taking advantage of the opportunities the company offers, Olmsted said.
“That’s a win-win,” Olmsted said. “We are helping our employees gain additional skills, and as a result of that, the company’s operations reap the benefits of having higher-skilled employees.”
Ultimately, the best recruitment and retention tool is to make Freeport “a place where everybody wants to work,” he said. That includes paying a competitive wage, Olmsted said in response to questions submitted by many of the listeners.
“We offer a competitive wage at all our sites globally, with a goal to keep up with market trends in those areas,” Olmsted said following the conclusion of the town hall. In addition to wages, Olmsted noted it’s also important to consider the entire compensation package, which includes a full range of benefits, 401(k) match and bonus opportunities.
Copper demand remains high
Elliott said that the outlook for copper remains strong, despite inflationary pressures and lingering concerns about a potential global recession. Copper stockpiles are low, demand remains high and coronavirus-related lockdowns in China, which represents about 50 percent of the global market, are being lifted.
In response to questions from several employees about plans to use electric haul trucks, Olmsted said the company is engaged with both Caterpillar and Komatsu to help develop a fully electric truck in the future. Olmsted said the goal is to have a pilot truck to test at Sierrita in 2024, but any implementation on a broader scale would still be several years away.
Given current copper market conditions, Olmsted also was asked about plans to consider resuming operations at sites currently not in service, such as Ajo.
“They’re always on our radar, but as we think about some of the challenges we have and the opportunities we have in front of us at our existing sites, our focus is really on supporting and driving production and growth at our existing operations,” he reiterated after the town hall.
Even at existing mine operations, there are challenges that limit expansion plans, notably personnel shortages, Olmsted continued.
The event closed with Olmsted answering the question he gets frequently at town halls – what keeps him up at night. As always, his answer was “safety and our ability to manage that.”