Freeport McMoRan (NYSE:FCX) has announced a $7.5 billion expansion of its El Abra copper mine in northern Chile. Freshly-appointed CEO Kathleen Quirk made this announcement during an earnings call on Tuesday that exceeded expectations.

"We're going to continue to review the economics in the context of market conditions, but believe this is a project that will be required in the future to support long-term copper demand trends," Quirk clarified to analysts on the call.

El Abra, located in the Antofagasta region, is co-owned by Freeport McMoRan with a 51% stake, while the remaining 49% is held by Chilean state-run Codelco, one of the world's largest copper producers. The mine produced 98,400 metric tons of copper last year, according to self-published reports.

The project involves a significant expansion, with a new concentrator plant and desalination infrastructure planned to meet water requirements. The expansion aims to boost production to 340,000 metric tons of copper annually by 2025, up from the current output. The project will also yield approximately 4,100 metric tons of molybdenum per year.

Chairman Richard Adkerson noted Codelco's eagerness regarding the expansion plan but emphasized the need for further dialogue with Chilean President Gabriel Boric.

"Codelco is anxious for us to move forward," Adkerson said, adding that Boric has proven to be supportive of the mining industry. "The tone is significantly changed from his initial election period."

The expansion will involve significant infrastructural developments, including a new concentrator plant and pipelines for water requirements. Additionally, investments in desalinization are part of the plan. The project will yield 750 million pounds of copper and 9 million pounds of molybdenum annually, highlighting its potential to meet the growing global demand for these metals.

This ambitious expansion aligns with Quirk's strategy of pursuing internal growth and capitalizing on existing assets. Since becoming CEO earlier this year, she focused on strengthening the existing projects instead of pursuing growth through mergers and acquisitions.

In addition to announcing the expansion, Freeport McMoran has declared a dividend and initiated stock buybacks. On June 26, 2024, the company's board declared cash dividends totaling $0.15 per share on its common stock. This includes a $0.075 per share quarterly base cash dividend and a $0.075 per share quarterly variable, performance-based cash dividend, to be paid on August 1, 2024.

In July 2024, Freeport acquired 1.2 million shares of its common stock for a total cost of $59 million, further demonstrating the company's commitment to returning value to its shareholders.