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                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549


                                    FORM 10-Q


                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934


                    For the quarter ended September 30, 1999

                           Commission file number 1-82


                            PHELPS DODGE CORPORATION
                            (a New York corporation)


                                   13-1808503
                      (I.R.S. Employer Identification No.)


                 2600 N. Central Avenue, Phoenix, AZ 85004-3089


                  Registrant's telephone number: (602) 234-8100


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports)  and  (2)  has  been  subject  to such  filing
requirements for the past 90 days. Yes [X] No [ ].

Number of Common Shares outstanding at November 10, 1999: 74,779,977 shares.

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<PAGE>
                            PHELPS DODGE CORPORATION

                          QUARTERLY REPORT ON FORM 10-Q

                    FOR THE QUARTER ENDED SEPTEMBER 30, 1999


                                Table of Contents

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
Part I. Financial Information

     Item 1. Financial Statements
       Statement of Consolidated Operations ..............................
       Consolidated Balance Sheet ........................................
       Consolidated Statement of Cash Flows ..............................
       Consolidated Statement of Common Shareholders' Equity .............
       Financial Data by Business Segment ................................
       Notes to Consolidated Financial Information .......................
       Review by Independent Accountants .................................
       Report of Independent Accountants on Review of Interim
         Financial Information ...........................................

     Item 2. Management's Discussion and Analysis
       Results of Operations .............................................
       Results of Phelps Dodge Mining Company ............................
       Results of Phelps Dodge Industries ................................
       Other Matters Relating to the Statement of Consolidated Operations
       Changes in Financial Condition ....................................

Part II. Other Information

     Item 6. Exhibits and Reports on Form 8-K ............................

     Signatures ..........................................................

     Index to Exhibits ...................................................
</TABLE>
<PAGE>
                                       -1-

                    PHELPS DODGE CORPORATION AND SUBSIDIARIES
                          Part I. Financial Information

ITEM 1. FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                 Third Quarter         First Nine Months
                                                              -------------------    --------------------
                                                                1999       1998        1999        1998
                                                              --------   --------    --------    --------
<S>                                                           <C>        <C>         <C>         <C>
STATEMENT OF CONSOLIDATED OPERATIONS
(Unaudited; in millions except per share data)

SALES AND OTHER OPERATING REVENUES ........................   $  742.7      764.0     2,096.9     2,356.7
                                                              --------   --------    --------    --------
OPERATING COSTS AND EXPENSES
    Cost of products sold .................................      579.6      594.7     1,652.8     1,790.8
    Depreciation, depletion and amortization ..............       68.4       74.0       212.7       218.5
    Selling and general administrative expense ............       29.8       27.4        89.6        91.6
    Exploration and research expense ......................       12.3       15.2        33.4        41.5
    Non-recurring charges and provision for
      asset disposition (see Notes 4 and 5) ...............        1.1      (12.6)       84.1      (198.7)
                                                              --------   --------    --------    --------
                                                                 691.2      698.7     2,072.6     1,943.7
                                                              --------   --------    --------    --------
OPERATING INCOME ..........................................       51.5       65.3        24.3       413.0
    Interest expense ......................................      (20.3)     (23.3)      (68.4)      (67.9)
    Capitalized interest ..................................         --        0.5         0.1         1.7
    Miscellaneous income and expense, net .................        2.9        7.1        (3.5)       29.4
                                                              --------   --------    --------    --------
INCOME (LOSS) BEFORE TAXES, MINORITY INTERESTS,
  EQUITY IN NET EARNINGS OF AFFILIATED COMPANIES
  AND CUMULATIVE EFFECT OF ACCOUNTING CHANGE ..............       34.1       49.6       (47.5)      376.2
    Provision for taxes on income .........................      (17.4)     (19.0)        1.3      (138.5)
    Minority interests in consolidated subsidiaries .......       (0.6)      (2.9)       (0.1)       (6.7)
    Equity in net earnings of affiliated companies ........       (0.7)       0.9         4.7         1.7
                                                              --------   --------    --------    --------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE       15.4       28.6       (41.6)      232.7

    Cumulative effect of accounting change (see Note 6) ...         --         --        (3.5)         --
                                                              --------   --------    --------    --------
NET INCOME (LOSS) .........................................   $   15.4       28.6       (45.1)      232.7
                                                              ========   ========    ========    ========
AVERAGE NUMBER OF SHARES OUTSTANDING - BASIC ..............       57.8       58.3        57.8        58.4

BASIC EARNINGS (LOSS) PER SHARE BEFORE CUMULATIVE EFFECT
  OF ACCOUNTING CHANGE ....................................   $   0.27       0.49       (0.72)       3.98
    Cumulative effect of accounting change (see Note 6) ...         --         --       (0.06)         --
                                                              --------   --------    --------    --------
BASIC EARNINGS (LOSS) PER SHARE ...........................   $   0.27       0.49       (0.78)       3.98
                                                              ========   ========    ========    ========
AVERAGE NUMBER OF SHARES OUTSTANDING - DILUTED ............       58.1       58.5        57.8        58.6

DILUTED EARNINGS (LOSS) PER SHARE BEFORE CUMULATIVE EFFECT
  OF ACCOUNTING CHANGE ....................................   $   0.27       0.49       (0.72)       3.97
    Cumulative effect of accounting change (see Note 6) ...         --         --       (0.06)         --
                                                              --------   --------    --------    --------
DILUTED EARNINGS (LOSS) PER SHARE .........................   $   0.27       0.49       (0.78)       3.97
                                                              ========   ========    ========    ========
</TABLE>

See Notes to Consolidated Financial Information.
<PAGE>
                                       -2-

CONSOLIDATED BALANCE SHEET
(Unaudited; in millions)

<TABLE>
<CAPTION>
                                                     September 30,  December 31,
                                                         1999          1998
                                                       --------      --------
<S>                                                    <C>           <C>
ASSETS
  Cash and cash equivalents .........................  $  165.0         221.7
  Accounts receivable, net ..........................     407.9         321.1
  Inventories .......................................     269.5         266.0
  Supplies ..........................................     104.6         110.9
  Prepaid expenses ..................................      17.1          16.5
  Deferred income taxes .............................      48.9          43.8
                                                       --------      --------
    Current assets ..................................   1,013.0         980.0
  Investments and long-term accounts receivable .....      91.7          85.6
  Property, plant and equipment, net ................   3,455.7       3,587.2
  Other assets and deferred charges .................     328.9         383.7
                                                       --------      --------
                                                       $4,889.3       5,036.5
                                                       ========      ========
LIABILITIES
  Short-term debt ...................................  $  229.8         116.1
  Current portion of long-term debt .................      54.7          68.5
  Accounts payable and accrued expenses .............     467.3         451.3
  Accrued income taxes ..............................       2.9          15.2
                                                       --------      --------
    Current liabilities .............................     754.7         651.1
  Long-term debt ....................................     806.5         836.4
  Deferred income taxes .............................     499.7         508.6
  Other liabilities and deferred credits ............     373.1         359.7
                                                       --------      --------
                                                        2,434.0       2,355.8
                                                       --------      --------
MINORITY INTERESTS IN CONSOLIDATED SUBSIDIARIES .....      78.5          93.3
                                                       --------      --------
COMMON SHAREHOLDERS' EQUITY
  Common shares, 58.0 outstanding (12/31/98 - 57.9) .     362.5         362.1
  Capital in excess of par value ....................       5.8           1.8
  Retained earnings .................................   2,212.9       2,345.0
  Accumulated other comprehensive income (loss) .....    (197.1)       (113.9)
  Other .............................................      (7.3)         (7.6)
                                                       --------      --------
                                                        2,376.8       2,587.4
                                                       --------      --------
                                                       $4,889.3       5,036.5
                                                       ========      ========
</TABLE>

See Notes to Consolidated Financial Information.
<PAGE>
                                       -3-

CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited; in millions)

<TABLE>
<CAPTION>
                                                                          Nine months ended
                                                                              Sept. 30,
                                                                          ----------------
                                                                           1999      1998
                                                                          ------    ------
<S>                                                                       <C>       <C>
OPERATING ACTIVITIES
  Net income (loss) ...................................................   $(45.1)    232.7
  Adjustments to reconcile net income (loss) to net cash
    provided by operating activities:
      Depreciation, depletion and amortization ........................    212.7     218.5
      Deferred income taxes ...........................................     (3.8)     40.8
      Equity earnings (loss) net of dividends received ................     (4.6)     (0.1)
      Changes in current assets and liabilities:
        (Increase) decrease in  accounts receivable ...................   (104.0)    (34.8)
        (Increase) decrease in inventories ............................    (12.4)    (17.3)
        (Increase) decrease in supplies ...............................      3.5      (3.0)
        (Increase) decrease in prepaid expenses .......................     (1.0)     (3.5)
        (Increase) decrease in deferred income taxes ..................     (5.2)      6.7
        Increase (decrease) in interest payable .......................      9.2      17.3
        Increase (decrease) in other accounts payable .................    (14.2)    (44.8)
        Increase (decrease) in accrued income taxes ...................    (11.6)     28.8
        Increase (decrease) in other accrued expenses .................     (1.6)     (6.9)
      Asset dispositions and non-recurring charges (see Notes 4 and 5)      85.8    (198.7)
      Other adjustments, net ..........................................      8.9      (7.8)
                                                                          ------    ------
          Net cash provided by operating activities ...................    116.6     227.9
                                                                          ------    ------
INVESTING ACTIVITIES
  Capital outlays .....................................................   (101.2)   (248.8)
  Capitalized interest ................................................     (0.1)     (1.7)
  Investment in subsidiaries ..........................................    (75.4)   (135.4)
  Proceeds from asset dispositions and other, net (see Notes 4 and 5)        7.3     466.5
                                                                          ------    ------
          Net cash provided by (used in) investing activities .........   (169.4)     80.6
                                                                          ------    ------
FINANCING ACTIVITIES
  Increase in debt ....................................................    136.3      16.0
  Payment of debt .....................................................    (49.0)    (54.0)
  Common dividends ....................................................    (87.0)    (88.3)
  Purchase of common shares ...........................................       --     (31.5)
  Other, net ..........................................................     (4.2)      0.9
                                                                          ------    ------
          Net cash used in financing activities .......................     (3.9)   (156.9)
                                                                          ------    ------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ......................    (56.7)    151.6
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ......................    221.7     157.9
                                                                          ------    ------
CASH AND CASH EQUIVALENTS AT END OF PERIOD ............................   $165.0     309.5
                                                                          ======    ======
</TABLE>

See Notes to Consolidated Financial Information.
<PAGE>
                                       -4-

CONSOLIDATED STATEMENT OF COMMON SHAREHOLDERS' EQUITY
(Unaudited; in millions)

<TABLE>
<CAPTION>
                                               Common Shares                                Accumulated
                                            --------------------   Capital in                  Other                     Common
                                             Number      At Par    Excess of    Retained   Comprehensive              Shareholders'
                                            of Shares    Value     Par Value    Earnings   Income (loss)    Other        Equity
                                            --------    --------    --------    --------     --------      --------     --------
<S>                                         <C>         <C>         <C>         <C>          <C>           <C>          <C>
BALANCE AT DECEMBER 31, 1998 ............       57.9    $  362.1    $    1.8    $2,345.0     $ (113.9)     $   (7.6)    $2,587.4
  Stock options exercised ...............        0.1         0.3         2.0                                     --          2.3
  Restricted shares issued, net .........         --         0.1         1.0          --                        0.3          1.4
  Other investment adjustments ..........                                1.0          --                                     1.0
  Dividends on common shares ............                                          (87.0)                                  (87.0)
  Comprehensive income (loss):
    Net income (loss) ...................                                          (45.1)                                  (45.1)
    Other comprehensive income (loss),
      net of tax:
        Reclassification adjustment * ...                                                        11.8                       11.8
        Translation adjustment ..........                                                       (95.0)                     (95.0)
                                                                                             --------                   --------
        Other comprehensive income (loss)                                                       (83.2)                     (83.2)
                                                                                             --------                   --------
    Comprehensive income (loss) .........                                                                                 (128.3)
                                            --------    --------    --------    --------     --------      --------     --------
BALANCE AT SEPTEMBER 30, 1999 ...........       58.0    $  362.5    $    5.8    $2,212.9     $ (197.1)     $   (7.3)    $2,376.8
                                            ========    ========    ========    ========     ========      ========     ========
</TABLE>

DISCLOSURE OF RECLASSIFICATION AMOUNT:

*    The 1999 reclassification adjustment represents the write-off of cumulative
     translation adjustments as a result of the sale of PD Mining Ltd.

See Notes to Consolidated Financial Information.
<PAGE>
                                       -5-

FINANCIAL DATA BY BUSINESS SEGMENT
(Unaudited; in millions)

<TABLE>
<CAPTION>
                                                             PD Industries
                                       Phelps   ----------------------------------------
                                       Dodge    Specialty   Wire &    Other *             Segment     Corp.    Reconciling
                                       Mining   Chemicals   Cable    Segments    Total    Subtotal   & Other      Elims.     Totals
------------------------------------------------------------------------------------------------------------------------------------
<S>                                   <C>       <C>        <C>       <C>        <C>       <C>        <C>         <C>        <C>
THIRD QUARTER 1999
  Sales & other operating revenues:
    Unaffiliated customers ........   $  406.9     132.9      202.9        --      335.8     742.7         --          --      742.7
    Intersegment ..................       62.2        --        0.1        --        0.1      62.3         --       (62.3)        --
  Non-recurring charges ...........         --        --        1.1        --        1.1       1.1         --          --        1.1
  Operating income (loss) .........       36.2      21.9        4.9        --       26.8      63.0      (11.5)         --       51.5
  Assets at September 30 ..........    3,175.3     761.4      805.6        --    1,567.0   4,742.3    1,109.5      (962.5)   4,889.3
------------------------------------------------------------------------------------------------------------------------------------
THIRD QUARTER 1998
  Sales & other operating revenues:
    Unaffiliated customers ........   $  421.9     104.6      237.5        --      342.1     764.0         --          --      764.0
    Intersegment ..................       63.8        --        0.3        --        0.3      64.1         --       (64.1)        --
  Gain on asset disposition .......         --        --         --      12.6       12.6      12.6         --          --       12.6
  Operating income (loss) .........       27.2      17.7       17.0      12.6       47.3      74.5       (9.7)        0.5       65.3
  Assets at September 30 ..........    3,262.9     492.4      934.9        --    1,427.3   4,690.2      836.9      (496.1)   5,031.0
------------------------------------------------------------------------------------------------------------------------------------
FIRST NINE MONTHS 1999
  Sales & other operating revenues:
    Unaffiliated customers ........   $1,102.3     398.8      595.8        --      994.6   2,096.9         --          --    2,096.9
    Intersegment ..................      170.7        --        0.2        --        0.2     170.9         --      (170.9)        --
  Non-recurring charges ...........       34.5      19.9       29.5        --       49.4      83.9        0.2          --       84.1
  Operating income (loss) .........        8.2      62.7      (11.0)       --       51.7      59.9      (34.5)       (1.1)      24.3
  Assets at September 30 ..........    3,175.3     761.4      805.6        --    1,567.0   4,742.3    1,109.5      (962.5)   4,889.3
------------------------------------------------------------------------------------------------------------------------------------
FIRST NINE MONTHS 1998
  Sales & other operating revenues:
    Unaffiliated customers ........   $1,303.5     326.9      726.3        --    1,053.2   2,356.7         --          --    2,356.7
    Intersegment ..................      197.1        --        1.7        --        1.7     198.8         --      (198.8)        --
  Gain on asset disposition .......         --        --         --     198.7      198.7     198.7         --          --      198.7
  Operating income (loss) .........      119.2      61.3       66.2     198.7      326.2     445.4      (30.8)       (1.6)     413.0
  Assets at September 30 ..........    3,262.9     492.4      934.9        --    1,427.3   4,690.2      836.9      (496.1)   5,031.0
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

*    Other  segments  include  Accuride  Corporation  which  was sold  effective
     January 1, 1998. (See Note 5 for a further discussion of this sale.)
<PAGE>
                                      - 6 -

NOTES TO CONSOLIDATED FINANCIAL INFORMATION
(Unaudited)

1.   The unaudited  consolidated financial information presented herein has been
     prepared  in  accordance  with the  instructions  to Form 10-Q and does not
     include all of the information and note  disclosures  required by generally
     accepted accounting principles.  Therefore, this information should be read
     in conjunction with the consolidated financial statements and notes thereto
     included  in our Form  10-K for the year  ended  December  31,  1998.  This
     information   reflects  all  adjustments   that  are,  in  the  opinion  of
     management,  necessary  to a fair  statement of the results for the interim
     periods reported.

2.   The results of operations for the three-month and nine-month  periods ended
     September  30, 1999,  are not  necessarily  indicative of the results to be
     expected for the full year.

3.   Depending  on  market  circumstances,   we  may  periodically  purchase  or
     liquidate  various copper price  protection  contracts for a portion of our
     expected  future  mine  production  to mitigate  the risk of adverse  price
     fluctuations. With respect to 2000 production, as of September 30, 1999, we
     had entered into annual contracts with several financial  institutions that
     effectively   ensure   minimum   (approximately   72  cents)  and   maximum
     (approximately  95 cents)  prices per pound for  approximately  110 million
     pounds of copper  cathode.  The minimum and maximum prices are based on the
     annual average LME price.

4.   On June 30, 1999, we announced a plan to reduce costs and improve operating
     performance  at  all  three  of our  business  segments  by (i)  curtailing
     higher-cost copper production by temporarily closing our Hidalgo smelter in
     New  Mexico and the  smaller of two  concentrators  at our  Morenci  mining
     operations in Arizona,  as well as  curtailing  production by 50 percent at
     our copper  refinery  in El Paso,  Texas;  (ii)  selling a  non-core  South
     African fluorspar mining unit; (iii)  restructuring  certain wire and cable
     assets to  respond  to  changing  market  conditions;  and (iv)  suspending
     operations  at  Columbian  Chemicals  Company's  carbon  black plant in the
     Philippines.  These  actions  resulted  in a total  non-recurring,  pre-tax
     charge of $84.7 million (or $58.7 million, $1.01 per share, after taxes and
     minority interests) in the 1999 second quarter and a pre-tax charge of $1.1
     million (or $0.7 million, 1 cent per share,  after taxes) in the 1999 third
     quarter.

     Our mining segment had  non-recurring,  pre-tax charges of $34.5 million in
     the 1999 second quarter from the  restructuring  plan. That amount included
     $7  million  resulting  from a loss  on the  sale of our  fluorspar  mining
     operation in South  Africa.  Also included in the  restructuring  plan were
     charges  associated with employee  severance  ($8.2  million),  pension and
     other  post-retirement  obligations ($5.6 million),  environmental  cleanup
     ($7.3 million) and mothballing  and  take-or-pay  contracts ($6.4 million).
     The current  liability  components  of the  restructuring  plan  related to
     employee severance,  mothballing and take-or-pay contracts during the third
     quarter of 1999 were as follows:

     (in millions)
<TABLE>
<CAPTION>
                                            Mothballing/
                                             Take-or-
                                Employee       Pay
                                Severance    Contracts     Total
                                 ------       ------       ------
<S>                              <C>          <C>          <C>
     Opening balance             $  8.2          6.4         14.6
     Payments made                 (5.3)        (0.9)        (6.2)
                                 ------       ------       ------
     Closing balance             $  2.9          5.5          8.4
                                 ======       ======       ======
</TABLE>

     Our specialty chemicals segment had non-recurring, pre-tax charges of $19.9
     million in the 1999 second quarter from the restructuring plan. Included in
     that  amount were costs  associated  with asset and  investment  write-offs
     ($14.9  million),  environmental  and  other  clean-up  ($3  million),  and
     employee  severance  ($2  million).  There  were no  payments  for  current
     liability   components  of  the  restructuring  plan  related  to  employee
     severance  and  environmental  and other  clean-up  costs  during the third
     quarter of 1999.

     Our wire and cable  segment  had  non-recurring,  pre-tax  charges of $30.1
     million  in the 1999  second  quarter  and $1.1  million  in the 1999 third
     quarter from the  restructuring  plan.  Included in the 1999 second quarter
     restructuring plan charges were asset write-offs ($21.4 million),  employee
     severance ($5 million), disposal,  dismantling and relocation ($2 million),
     and the  write-off  of an  equity  basis  investment  ($1.7  million).  The
<PAGE>
                                       -7-

     components of the  restructuring  plan related to employee  severance,  and
     disposal and  dismantling  costs  during the third  quarter of 1999 were as
     follows:

     (in millions)

<TABLE>
<CAPTION>
                                               Disposal
                                Employee         and
                                Severance    Dismantling     Total
                                 ------         ------       ------
<S>                              <C>            <C>          <C>
     Opening balance             $  5.0            1.0          6.0
     Reclassification
       of restructure *            (1.5)           0.0         (1.5)
     Payments made                 (1.4)          (0.0)        (1.4)
                                 ------         ------       ------
     Closing balance             $  2.1            1.0          3.1
                                 ======         ======       ======
</TABLE>

     * Reclassified to pension and post-retirement benefit obligations.

     The third  quarter  1999  charges  of $1.1  million  were  principally  for
     expenses to relocate equipment.

5.   Effective  January 1, 1998, we sold a 90 percent  interest in our wheel and
     rim manufacturing  business,  Accuride Corporation and related subsidiaries
     (Accuride),  to an affiliate of Kohlberg  Kravis  Roberts and Co. (KKR) and
     the existing  management of Accuride.  That sale resulted in a pre-tax gain
     of $186.1 million  ($122.8 million after taxes, or $2.09 per common share).
     The  remaining 10 percent  interest in Accuride  was sold to RSTW  Partners
     III,  L.P.,  on September  30,  1998,  resulting in a pre-tax gain of $12.6
     million ($8.3 million after taxes, or 14 cents per common share). Under the
     terms of the sales agreements, we received total proceeds of $465.9 million
     from  the  two   transactions,   less  $16.4  million  in  working  capital
     adjustments and transaction costs.

6.   In the 1999 first quarter, we adopted SOP 98-5,  "Reporting on the Costs of
     Start-Up  Activities."  The  implementation  resulted  in  a  $3.5  million
     after-tax charge,  or 6 cents per common share,  representing the write-off
     of previously unamortized start-up costs at our Candelaria mining operation
     in Chile and our magnet wire operation in Monterrey, Mexico.

7.   In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
     "Accounting  for  Derivative  Instruments  and  Hedging  Activities."  This
     statement  requires  recognition  of all  derivatives  as either  assets or
     liabilities on the balance sheet and  measurement  of those  instruments at
     fair value.  Changes in the fair value of  derivatives  are  recorded  each
     period in current  earnings or other  comprehensive  income (loss).  Proper
     accounting  for changes in fair value of  derivatives  held is dependent on
     whether the derivative  transaction qualifies as an accounting hedge and on
     the classification of the hedge  transaction.  The statement was originally
     required to be adopted in the first quarter of 2000.  Citing concerns about
     companies'  ability to modify their  information  systems and educate their
     managers in time to apply SFAS No.133, the Financial  Accounting  Standards
     Board has delayed its effective  date for one year. We are  evaluating  the
     effect this statement will have on our financial  reporting and disclosures
     as well as on our derivative and hedging activities.

8.   As of December 31,  1998,  we had a reserve  balance of $106.0  million for
     estimated future costs associated with  environmental  matters.  During the
     first nine months of 1999, net spending  against that reserve  totaled $8.4
     million.  During the second quarter of 1999, we recorded an additional $8.3
     million provision for estimated future costs associated with  environmental
     matters as part of our restructuring  plan announced on June 30, 1999. This
     $8.3 million  increase in the  environmental  reserve  balance was directly
     related to the indefinite  suspension of operations at our Hidalgo  smelter
     ($7.3 million) and our Philippine carbon black facility ($1.0 million).  As
     of September 30, 1999, the reserve balance was $105.9 million.

9.   On October 22, 1999, we announced  the  completion of our offer to exchange
     $7.61 in cash and 0.2203  Phelps Dodge shares for each share of Cyprus Amax
     Minerals  Company  (Cyprus Amax) on a fully  prorated  basis.  The exchange
     offer expired at 12:00 midnight, eastern time, October 15, 1999.

     We were informed by ChaseMellon  Shareholder  Services,  the exchange agent
     for the offer,  that based on a final count,  81.5 million shares of Cyprus
     Amax stock were  tendered,  representing  89.6  percent of the  outstanding
     shares of Cyprus Amax. Of the 81.5 million  shares  tendered,  51.3 million
     elected cash, 29.8 million elected stock and 351,000 made no election.  All
     shares of Cyprus Amax  tendered  were accepted for
<PAGE>
                                       -8-

     exchange by Phelps Dodge according to the terms of the exchange offer.

     The October  15,  1999,  exchange  offer  resulted in the  exchange of 16.7
     million  shares of Phelps Dodge stock and $693  million in cash.  We expect
     the  acquisition  of Cyprus Amax to be 100 percent  complete by December 2,
     1999, with the remaining  Cyprus Amax shares to be acquired in exchange for
     approximately  3.3 million shares of Phelps Dodge stock. The total purchase
     price including acquired debt, net of cash, is expected to be approximately
     $2.6 billion for 100 percent of the shares of Cyprus Amax.

     The primary assets of Cyprus Amax include the wholly owned Sierrita, Bagdad
     and Miami copper mining  operations in Arizona,  the wholly owned  smelter,
     refinery  and rod  plant in  Miami,  Arizona,  a wholly  owned rod plant in
     Chicago,  Illinois,  the 51 percent owned El Abra copper operation in Chile
     and the 82 percent owned Cerro Verde copper operation in Peru.  Cyprus Amax
     also owns two  molybdenum  mining  operations  (Henderson  and  Climax)  in
     Colorado and molybdenum conversion plants at Sierrita;  Ft. Madison,  Iowa;
     Rotterdam, the Netherlands; and Stowmarket, U.K.

     Pro forma financial  information for this  transaction  will be provided in
     the required Form 8-K filing toward the end of December. The acquisition of
     Cyprus Amax will be completed  using the purchase  method,  and accordingly
     the assets and liabilities will be adjusted to reflect their fair value.

                        REVIEW BY INDEPENDENT ACCOUNTANTS

          The  financial  information  as of  September  30,  1999,  and for the
     three-month  and  nine-month  periods  ended  September  30, 1999 and 1998,
     included  in Part I  pursuant  to Rule  10-01  of  Regulation  S-X has been
     reviewed  by  PricewaterhouseCoopers  LLP   (PricewaterhouseCoopers),   our
     independent  accountants,  in accordance with standards  established by the
     American Institute of Certified Public Accountants. PricewaterhouseCoopers'
     report is included in this quarterly report.

          PricewaterhouseCoopers   does  not  carry  out  any   significant   or
     additional  audit tests beyond those that would have been  necessary if its
     report had not been included in this quarterly  report.  Accordingly,  such
     report is not a "report" or "part of a registration  statement"  within the
     meaning  of  Sections  7 and  11 of the  Securities  Act of  1933  and  the
     liability provisions of Section 11 of such Act do not apply.
<PAGE>
                                       -9-

<AUDIT-REPORT>
                        REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Shareholders
  of the Phelps Dodge Corporation

We have  reviewed the  accompanying  consolidated  balance sheet of Phelps Dodge
Corporation  and its  subsidiaries  as of September  30,  1999,  and the related
consolidated  statements  of  operations,   for  each  of  the  three-month  and
nine-month  periods  ended  September  30,  1999 and  1998 and the  consolidated
statement of cash flows and of common  shareholders'  equity for the  nine-month
periods ended  September 30, 1999 and 1998.  This  financial  information is the
responsibility of the Corporation's management.

We conducted our review in accordance with standards established by the American
Institute  of  Certified  Public  Accountants.  A review  of  interim  financial
information consists principally of applying analytical  procedures to financial
data and making  inquiries of persons  responsible  for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with  generally  accepted  auditing  standards,  the  objective  of which is the
expression of an opinion  regarding the financial  statements  taken as a whole.
Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material  modifications that should
be made to the accompanying consolidated financial information referred to above
for it to be in conformity with generally accepted accounting principles.

We previously audited in accordance with generally accepted auditing  standards,
the  consolidated  balance  sheet  as of  December  31,  1998,  and the  related
consolidated  statements  of income,  of cash flows and of common  shareholders'
equity for the year then ended (not presented  herein),  and in our report dated
January 14,  1999,  we expressed an  unqualified  opinion on those  consolidated
financial  statements.  In  our  opinion,  the  information  set  forth  in  the
accompanying  consolidated balance sheet information as of December 31, 1998, is
fairly stated in all material  respects in relation to the consolidated  balance
sheet from which it has been derived.


PricewaterhouseCoopers LLP
Phoenix, Arizona
October 11, 1999, except as to Note 9, which is as of October 18, 1999
</AUDIT-REPORT>
<PAGE>
                                      -10-

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

     The  U.S.   securities   laws   provide  a  "safe   harbor"   for   certain
forward-looking  statements.  This quarterly  report  contains  "forward-looking
statements"  that  express   expectations  of  future  events  or  results.  All
statements  based on  future  expectations  rather  than  historical  facts  are
forward-looking statements that involve a number of risks and uncertainties, and
Phelps Dodge Corporation (the company, which may be referred to as Phelps Dodge,
we, us or ours)  cannot give  assurance  that such  statements  will prove to be
correct.  Please refer to the Management's  Discussion and Analysis  sections of
the company's report on Form 10-K for the year ended December 31, 1998.

RESULTS OF OPERATIONS

     EARNINGS

     The company had  consolidated  earnings in the 1999 third  quarter of $16.1
million, or 28 cents per common share, before  non-recurring,  after-tax charges
of $0.7  million,  or 1 cent per common share from the  company's  restructuring
plan  announced  on June 30, 1999  (please  refer to Note 4 to the  Consolidated
Financial  Information).  Our third  quarter net income after the  restructuring
charges was $15.4 million, or 27 cents per common share. By comparison, earnings
in the 1998 third  quarter  were $20.3  million,  or 35 cents per common  share,
excluding  a  non-recurring,  after-tax  gain of $8.3  million,  or 14 cents per
common share,  from the completion of the  disposition  of Accuride  Corporation
(please refer to Note 5 to the Consolidated Financial Information).

     Earnings for the nine months ended  September 30, 1999, were $17.8 million,
or 31 cents per common share,  before  after-tax  charges of $59.4  million,  or
$1.03 per common share from the  restructuring  plan, and an after-tax charge of
$3.5 million,  or 6 cents per common share,  recognized in the first quarter for
the  cumulative  effect of an  accounting  change  associated  with  unamortized
start-up  costs  (please  refer  to  Note  6  to  the   Consolidated   Financial
Information).  The net loss for the nine months ended September 30, 1999,  after
the  non-recurring  charges  was $45.1  million,  or 78 cents per common  share.
Earnings  for the first nine  months of 1998 were $101.6  million,  or $1.73 per
common share, before a non-recurring, after-tax gain of $131.1 million, or $2.24
per common share, from the sale of Accuride Corporation.

     Earnings  before  non-recurring  items were less in the  nine-month  period
ended September 30, 1999, than in the corresponding 1998 period principally as a
result of lower  average  copper  prices and reduced  earnings from our wire and
cable  segment.  The average  spot price per pound of cathode  copper on the New
York Commodity  Exchange  (COMEX) for the first nine months was  approximately 7
cents per pound (9  percent)  lower  than the  average  price for the first nine
months of 1998.  The effect of this price  decrease  was  somewhat  mitigated by
decreased  copper  production  costs and  increased  earnings  at our  specialty
chemicals segment.

     The COMEX  spot price per pound of copper  cathode,  upon which we base our
selling price,  averaged 78 cents in the third quarter and 70 cents in the first
nine months of 1999,  compared  with 75 cents and 77 cents in the  corresponding
1998 periods. From October 1 through November 10, 1999, the COMEX price averaged
80 cents per pound, closing at 79 cents on November 10, 1999.

     Any  material  change in the price we receive  for  copper,  or in our unit
production costs, has a significant  effect on our results.  As of September 30,
1999,  our share of annual  production was  approximately  1.5 billion pounds of
copper. Accordingly, each 1-cent per pound change in our average annual realized
copper price,  or in our average  annual unit  production  costs,  might cause a
variation  in  annual  pre-tax  operating  income  levels of  approximately  $15
million.

     Depending  on  market  circumstances,   we  may  periodically  purchase  or
liquidate  various  copper  price  protection  contracts  for a  portion  of our
expected   future  mine  production  to  mitigate  the  risk  of  adverse  price
fluctuations.  With respect to 2000 production, as of September 30, 1999, we had
entered  into  annual  contracts  with  several   financial   institutions  that
effectively ensure minimum  (approximately 72 cents) and maximum  (approximately
95 cents)  prices  per  pound for  approximately  110  million  pounds of copper
cathode.  The  minimum and  maximum  prices are based on the annual  average LME
price.

     SALES

     Sales were $742.7 million in the 1999 third quarter and $2,096.9 million in
the first nine months of 1999, compared with $764.0 million and $2,356.7 million
in the corresponding  1998 periods.  The 1999 decrease for the first nine months
principally  resulted from lower average copper  prices,  lower sales volumes of
copper and lower sales of wire and cable  products,  partially  offset by higher
sales volumes of carbon black.
<PAGE>
                                      -11-

     BUSINESS SEGMENTS

     Results  for  1999  and  1998  can be  meaningfully  compared  by  separate
reference to our  reporting  divisions,  Phelps Dodge Mining  Company and Phelps
Dodge  Industries.  Phelps  Dodge  Mining  Company  is a business  segment  that
includes our worldwide  copper  operations  from mining through rod  production,
marketing and sales,  other mining  operations  and  investments,  and worldwide
mineral exploration and development programs.  Through December 31, 1997, Phelps
Dodge Industries  included our specialty  chemicals segment,  our wire and cable
segment,  and our  wheel  and rim  operations  (see  Note 5 to the  Consolidated
Financial  Information  for a  discussion  of the  sale  of our  wheel  and  rim
operations effective January 1, 1998).

RESULTS OF PHELPS DODGE MINING COMPANY

     Phelps  Dodge  Mining  Company  (PD  Mining) is an  international  business
comprising  a group  of  companies  involved  in  vertically  integrated  copper
operations  including  mining,  concentrating,   electrowinning,   smelting  and
refining, rod production, marketing and sales, and related activities. Copper is
sold primarily to others as rod, cathode or concentrates, and as rod to our wire
and cable segment. We also, at times, smelt and refine copper and produce copper
rod for others on a toll basis.  We also produce gold,  silver,  molybdenum  and
copper chemicals as by-products,  and sulfuric acid from our air quality control
facilities.  This business segment also includes our other mining operations and
investments  (including  silver and zinc  operations) and our worldwide  mineral
exploration and development programs.

<TABLE>
<CAPTION>
                                                              Third Quarter
                                                          ----------------------
                                                           1999           1998
                                                          -------        -------
<S>                                                       <C>            <C>
Copper production (short tons):
     Total production ............................        227,800        265,400
     Less minority participants'
       shares (A) ................................         40,200         44,800
                                                          -------        -------
     Net Phelps Dodge share ......................        187,600        220,600
                                                          =======        =======
Copper sales (short tons):
     Net Phelps Dodge share
       from own mines ............................        193,000        220,600
     Purchased copper ............................         71,300         73,700
                                                          -------        -------
     Total copper sales ..........................        264,300        294,300
                                                          =======        =======
New York Commodity Exchange
     Average spot price per pound -
     copper cathodes .............................        $  0.78           0.75

                                                               (in millions)
Sales and other operating revenues
     - unaffiliated customers ....................        $ 406.9          421.9

Operating income (B) .............................        $  36.2           27.2

                                                            First Nine Months
                                                          ----------------------
                                                           1999           1998
                                                          -------        -------
Copper production (short tons):
     Total production ............................        720,600        792,300
     Less minority participants'
       shares (A) ................................        125,000        134,100
                                                          -------        -------
     Net Phelps Dodge share ......................        595,600        658,200
                                                          =======        =======
Copper sales (short tons):
     Net Phelps Dodge share
       from own mines ............................        595,300        650,700
     Purchased copper ............................        205,600        232,700
                                                          -------        -------
     Total copper sales ..........................        800,900        883,400
                                                          =======        =======
New York Commodity Exchange
     Average spot price per pound -
     copper cathodes .............................        $  0.70           0.77

                                                               (in millions)
Sales and other operating revenues
     - unaffiliated customers ....................        $1,102.3       1,303.5

Operating income (B) .............................        $   8.2          119.2
</TABLE>

----------
(A)  Minority participant  interests include (i) a 15 percent undivided interest
     in the Morenci,  Arizona,  copper  mining  complex  held by Sumitomo  Metal
     Mining Arizona,  Inc., (ii) a one-third partnership interest in Chino Mines
     Company in New Mexico held by Heisei Minerals  Corporation,  and (iii) a 20
     percent  interest in Candelaria in Chile held by SMMA  Candelaria,  Inc., a
     jointly owned  subsidiary  of Sumitomo  Metal Mining Co., Ltd. and Sumitomo
     Corporation.

(B)  Operating  income  has been  presented  in  compliance  with SFAS No.  131,
     "Disclosures about Segments of an Enterprise and Related Information" (with
     1998  restated).  1999  includes a second  quarter  non-recurring,  pre-tax
     charge of $34.5 million for costs associated with a restructuring (see Note
     4 to the Consolidated Financial Information).
<PAGE>
                                      -12-

     PD MINING - SALES

     Phelps Dodge Mining Company's sales and other operating  revenues decreased
by $15.0 million, or 4 percent, in the 1999 third quarter and by $201.2 million,
or 15 percent,  in the first nine months of 1999 compared with the corresponding
1998  periods.  The  variance  for the first  nine  months  primarily  reflected
decreased average selling prices for copper that resulted in a revenue reduction
of approximately  $123 million.  The sales and other operating  revenue variance
for the third  quarter and the first nine months  also  reflected  the effect of
lower copper sales volumes that resulted in  approximately  $47 million and $115
million in revenue reductions.  The lower volumes were primarily a result of the
indefinite  suspension  of operations at our Cobre copper mine in New Mexico and
our Ojos del Salado copper mine in Chile,  and the  curtailment of production at
our Chino copper  operations  in New Mexico that we announced in the 1998 fourth
quarter.  The Ojos del Salado suspension occurred on October 21, 1998, while the
suspension  of Cobre  and the  curtailment  at Chino  were  completed  in phases
between October 21, 1998, and the 1999 first quarter.

     PD MINING - OPERATING INCOME

     PD Mining  reported  operating  income of $36.2  million  in the 1999 third
quarter.  This compares with $27.2 million in the corresponding 1998 period. The
increase  primarily  reflected  the  higher  average  copper  price for sales of
PD-mined copper (approximately $13 million) and slightly lower production costs,
partially offset by lower sales volumes of PD-mined copper. (Please refer to the
preceding  table.) For the nine-month period ended September 30, 1999, PD Mining
reported operating income of $42.7 million before non-recurring, pre-tax charges
of  $34.5  million  from a  restructuring  plan  (please  refer to Note 4 to the
Consolidated  Financial  Information).  This compares with  operating  income of
$119.2  million in the  corresponding  1998 period.  The  year-to-date  decrease
primarily  reflected the lower average copper price for sales of PD-mined copper
(approximately  $91  million)  and  lower  sales  volumes  of  PD-mined  copper,
partially  offset  by  lower  copper  production  costs.  (Please  refer  to the
preceding  table.)  Lower  1999  production  costs  were due in part to the 1998
curtailment and shutdown of certain higher cost operations.

                       RESULTS OF PHELPS DODGE INDUSTRIES

     Phelps  Dodge  Industries  (PD  Industries),  our  manufacturing  division,
produces    engineered    products    principally   for   the   global   energy,
telecommunications   and  specialty   chemicals  sectors.   Its  operations  are
characterized  by  products  with  significant  market  share,   internationally
competitive  cost and quality,  and specialized  engineering  capabilities.  The
manufacturing division includes our specialty chemicals segment and our wire and
cable segment.  Our specialty  chemicals  segment includes  Columbian  Chemicals
Company and its  subsidiaries  (Columbian).  Our wire and cable segment includes
Phelps  Dodge  Magnet Wire  Company and its  subsidiaries  (PD Magnet  Wire) and
Phelps Dodge International Corporation and its affiliates (PDIC).

<TABLE>
<CAPTION>
                                                              Third Quarter
                                                          ----------------------
                                                           1999           1998
                                                          -------        -------
                                                               (in millions)
<S>                                                       <C>            <C>
Sales and other operating revenues
     - unaffiliated customers:
     Specialty chemicals .........................        $ 132.9          104.6
     Wire and cable ..............................          202.9          237.5
                                                          -------        -------
                                                          $ 335.8          342.1
                                                          =======        =======
Operating income: (A)
     Specialty chemicals (B) .....................        $  21.9           17.7
     Wire and cable (C) ..........................            4.9           17.0
     Other (wheels and rims) (D) .................             --           12.6
                                                          -------        -------
                                                          $  26.8           47.3
                                                          =======        =======

                                                            First Nine Months
                                                          ----------------------
                                                           1999           1998
                                                          -------        -------
                                                               (in millions)
Sales and other operating revenues
     - unaffiliated customers:
     Specialty chemicals .........................        $ 398.8          326.9
     Wire and cable ..............................          595.8          726.3
                                                          -------        -------
                                                          $ 994.6        1,053.2
                                                          =======        =======
Operating income (loss): (A)
     Specialty chemicals (B) .....................        $  62.7           61.3
     Wire and cable (C) ..........................          (11.0)          66.2
     Other (wheels and rims) (D) .................             --          198.7
                                                          -------        -------
                                                          $  51.7          326.2
                                                          =======        =======
</TABLE>

----------
(A)  Operating  income  has been  presented  in  compliance  with SFAS No.  131,
     "Disclosures about Segments of an Enterprise and Related Information" (with
     1998 restated).

(B)  Includes a pre-tax  charge of $19.9 million in the 1999 second  quarter for
     costs  associated with the suspension of operations at a carbon black plant
     in the Philippines.
<PAGE>
                                      -13-

(C)  Includes a pre-tax  charge of $28.4 million in the 1999 second  quarter and
     $1.1  million  in  the  1999  third  quarter  for  costs   associated  with
     restructuring  of certain wire and cable  operations.  Another $1.7 million
     representing  the write-off of a small equity basis  investment was charged
     to miscellaneous income and expense in the 1999 second quarter.

(D)  See Note 5 to the Consolidated  Financial  Information for a description of
     the sale of our wheels and rims business in 1998.

     PD INDUSTRIES - SALES

     PD  Industries  reported  sales of $335.8  million in the third quarter and
$994.6  million for the first nine months of 1999,  compared with $342.1 million
and  $1,053.2  million  in the  corresponding  1998  periods.  The  year-to-date
decrease  principally  reflected  lower sales in the wire and cable segment as a
result of a downturn in the Brazilian wire and cable market  principally  caused
by the 1999 first quarter currency devaluation, continuing economic difficulties
in Venezuela and lower demand for conductors in the automotive, heat tracing and
aerospace  markets,  partially  offset by higher sales  volumes in the specialty
chemicals segment primarily due to the acquisition of carbon black operations in
Brazil and Korea in late 1998 and early 1999, respectively. (Please refer to the
preceding table.)

     PD INDUSTRIES - OPERATING INCOME

     During the 1999 third quarter,  PD Industries  recorded operating income of
$27.9 million before non-recurring charges of $1.1 million (please refer to Note
4 to the Consolidated Financial  Information).  This compares with $34.7 million
in the  corresponding  1998 period before a $12.6 million  pre-tax gain from the
disposition of Accuride.  Operating  income in the first nine months of 1999 was
$101.1 million before non-recurring charges, compared with $127.5 million in the
first nine months of 1998 before a $198.7 million  pre-tax gain from the sale of
Accuride.  PD Industries'  1999 operating  income  reflected  decreased wire and
cable  results  principally  due to  South  American  economic  difficulties,  a
continued  slowdown in aerospace and relevant  electronic  markets in the United
States and competitive price pressure on our magnet wire business. These effects
were partially  offset by strong  performances  by our carbon black  businesses,
which had overall  increases in sales  volumes in excess of 30 percent  compared
with  corresponding  prior periods.  These volume  increases  reflected the 1998
fourth quarter  acquisition  of a carbon black facility in Brazil,  and the 1999
first quarter acquisition of a carbon black facility in Korea.  (Please refer to
the preceding table.)

OTHER MATTERS RELATING TO THE STATEMENT OF CONSOLIDATED OPERATIONS

     EXPLORATION AND RESEARCH AND DEVELOPMENT EXPENSE

     Our  exploration  and research and  development  expense for the first nine
months  of  1999  was  $33.4  million,   compared  with  $41.5  million  in  the
corresponding  1998  period.  The  decrease  reflects   continuing  cutbacks  in
exploration  programs in view of current market conditions;  exploration charges
were $25.4 million in the 1999 first nine months, compared with $30.0 million in
the corresponding period in 1998.

     MISCELLANEOUS INCOME AND EXPENSE, NET

     Miscellaneous  income and expense,  net,  decreased by $32.9 million in the
first nine months of 1999  compared  with the  corresponding  1998 period.  This
change  primarily  reflected a 1998 second quarter  pre-tax gain of $8.8 million
from  the  dissolution  of joint  venture  partnerships  in the  wire and  cable
business,  1999 currency  exchange  losses at our Brazilian  operations of $11.2
million, $9.1 million in lower interest income and a $1.7 million pre-tax charge
representing  the  write-off  of an equity basis  investment  in the 1999 second
quarter.

     INCOME TAXES

     Our federal  income tax returns for the years 1990  through 1997 are either
under  examination  or review by the Internal  Revenue  Service  (IRS).  We have
received  proposed  assessments  for the years 1990 and 1991 and have  reached a
settlement with the IRS appeals  division on the issues  involved.  The proposed
settlement  results in a refund and must be approved by the Joint  Committee  on
Taxation.  We have also  received  and accepted  assessments  for the years 1992
through 1994. These assessments will  substantially  offset the proposed refunds
from 1990 and 1991. The years 1995 through 1997 are currently being examined and
the IRS has begun its information gathering process.

     Our  management  believes  it has made  adequate  provision  so that  final
resolution of the issues involved, including application of those determinations
to  subsequent  years,  will  not have an  adverse  effect  on our  consolidated
financial condition or results of operations.
<PAGE>
                                      -14-

     EQUITY EARNINGS

     Equity in net earnings of affiliated  companies increased in the first nine
months of 1999 by $3.0 million  primarily  due to the 1999 first quarter sale of
land by our equity basis Philippine wire and cable operation.

     YEAR 2000

     We continue to review our "Year 2000" readiness.  The Year 2000 issue stems
from the  predominant  use in  computer  applications  of a  two-digit  field to
capture the year (e.g., "99" for 1999). Because the "19" is assumed in the date,
when computers turn their clocks to the year 2000, the two-digit field will read
"00" and some  computer  programs  will assume the year is 1900.  Programs  that
calculate,  compare  or sort on a date  field may cause  erroneous  results  and
errors  leading  to the risk of  business  interruption  or  shutdown  and other
potential  problems.  The Year 2000 issue is a global issue that is very complex
because of the many programs that may be impacted in any computer system.  These
computer systems are used to support the activities of our businesses  including
financial  systems,  process  control  technology and other  computer-controlled
equipment.

     We have  identified  the scope of the Year 2000  issue as it relates to our
operations  and all levels of  management  are  providing  leadership  to effect
workable  solutions.  A program  office team has been  assembled  to oversee all
facets of this project  including  information  technology  and process  control
system  conversions,  contracts  and  agreements  with  vendors,  suppliers  and
customers,  insurance  policies,  contingency plans and security systems. We are
working with major industry associations and agencies in North America,  Europe,
Latin  America and Asia  Pacific to  facilitate  the sharing of  strategies  and
solutions.  We have hired PKS Systems  Integration  LLC, a consulting  firm,  to
assist us in the assessment and implementation of our Year 2000 conversion.

     The conversion project has been structured into four phases:

*    inventory phase (100 percent complete);
*    assessment phase - the final cost estimation and action plan identification
     phase (100 percent complete);
*    remediation and testing phase (100 percent complete); and
*    field  implementation  phase  (substantially  completed for all information
     technology  (IT) and  non-IT  systems  with the  exception  of a few mining
     process control systems intentionally delayed to match existing maintenance
     schedules;  these systems are  scheduled  for  completion by the end of the
     November 1999).

     The  process  of  identifying  and  prioritizing   critical  suppliers  and
customers has been  completed.  We have reviewed  contracts and agreements  with
vendors, suppliers and customers. Appropriate language has been added to all new
contracts and agreements to address our  requirements  for Year 2000 compliance.
Where  possible,  existing  contracts and agreements were amended for these same
considerations.  We prepared an  inventory of all  existing  relationships  with
vendors  and  suppliers.  We  reviewed  the  nature  of those  relationships  to
determine  whether  the loss of service or  product  would  result in a material
impact to us. From that overall list, we identified  vendors and suppliers  that
are considered key to our individual businesses,  and we contacted each of those
554  vendors  and  suppliers.  In  special  situations,  such  as  suppliers  of
transportation,  electrical power,  communications,  and water and sewerage,  we
visited  the  suppliers  to review  their Year 2000  preparations.  We  received
responses from all these vendors and suppliers,  and we are convinced,  based on
the  materials  and  information  they  supplied to us, that they are or will be
compliant.  In a similar  approach,  we identified key customers and worked with
them to determine  compliance  and assessed the nature of our  relationship.  In
each of these cases,  the customer was advanced in its Year 2000 preparation and
provided a schedule for its overall compliance.

     Our investment in  standardizing  business  system  platforms over the past
several  years  has   streamlined  and  facilitated  our  Year  2000  conversion
requirements by eliminating  redundant  technologies and allowing the sharing of
services.  These systems, some of which were IT systems and others of which were
non-IT systems (mostly process control  devices),  were installed to meet other,
non-Year  2000  business  needs.  As a part of the Year  2000  project,  we have
upgraded key financial and  manufacturing  systems in each operating unit and in
the  corporate  headquarters  by  installing  updates to  purchased  application
software  systems.  These  systems have been  certified  by their  vendors to be
compliant  and tested in the context in which they will  operate.  The compliant
versions of these systems currently function in support of day-to-day  business.
Non-information  technology  systems  have been  remediated  where  required  to
compliant  versions.  The updated  systems  have been  tested at  manufacturers'
laboratories and on-site, and they have
<PAGE>
                                      -15-

been  demonstrated  to be compliant.  These systems also  currently  function in
support of day-to-day business.

     The total cost  associated with our Year 2000 conversion is not expected to
be material to our  financial  position  and should not exceed $5 million.  This
estimate  does not  include our  potential  share of Year 2000 costs that may be
incurred at operations  that we do not  consolidate  or those  expenditures  for
planned  system and  process  control  upgrades  that are  undertaken  for other
reasons and also  incorporate Year 2000 compliant  technology.  Spending to date
has been approximately $3 million.

     Failure to correct a material Year 2000 problem could result in a potential
disruption to one or more of our operations.  Such failures could materially and
adversely affect our results of operations,  liquidity and financial  condition.
Due to the general  uncertainty  inherent in the Year 2000 issue,  resulting  in
part from the  uncertainty of the readiness of suppliers and  customers,  we are
unable to determine  with any certainty the  consequences  of Year 2000 failures
and the materiality of these potential  failures.  Therefore,  we have completed
the development of contingency plans. A team from each operating unit, under the
direction  of an  assigned  project  leader in the  program  office,  prepared a
specific plan to address contingencies for that operation. Contingencies include
failure of our own IT and non-IT systems,  failure to deliver supplies,  lack of
transportation, failure of electrical power, and failure of other utilities. Our
priorities in addressing these contingencies are safety,  environment,  customer
service, and loss of production. The plans were completed by October 31, 1999.

     We  have  prepared  an  event  management  center  to  oversee   activities
world-wide during the actual date change.  This center will monitor responses to
contingencies and provide current information to on-site managers at all company
operations.

CHANGES IN FINANCIAL CONDITION

     DEBT

     At September 30, 1999, our total debt was $1,091.0  million,  compared with
$1,021.0  million at  year-end  1998.  The $70.0  million  increase  principally
resulted from  financing  for the purchase of a carbon black  business in Korea.
Our ratio of debt to total  capitalization  was 30.8  percent at  September  30,
1999, compared with 27.6 percent at December 31, 1998.

     On October 22,  1999,  we entered  into a loan  agreement  with Cyprus Amax
Minerals  Company whereby they would loan us $175 million at an interest rate of
6 percent  per annum.  On that  date,  we drew down the $175  million;  the loan
matures on December 15, 1999.

     CAPITAL EXPENDITURES AND INVESTMENTS

     Capital  expenditures and investments  during the first nine months of 1999
were $55.4 million for PD Mining and $118.9 million for PD Industries, including
$76.1 million for the acquisition of an 85 percent interest in the Korean carbon
black  manufacturing  business of Korea Kumho  Petrochemical  Co., Ltd.  Capital
expenditures  and  investments  in the  corresponding  1998  period  were $279.9
million for PD Mining,  including  $113.3  million for the  acquisition of Cobre
Mining  Company,  and $105.5  million for PD  Industries.  The  company  expects
capital  expenditures and investments for the year 1999 to be approximately $100
million for PD Mining and approximately $165 million for PD Industries.

     DIVIDENDS

     On September 10, 1999, we paid a regular quarterly dividend of 50 cents per
share on our common shares for the 1999 third quarter. The total amount paid was
$29.0 million,  bringing total 1999 dividends paid through September 30 to $87.0
million.

     SHARE PURCHASES

     This year  through  November  10, we have not  purchased  any of our shares
under  our May 7,  1997,  share  purchase  authorization.  Under  that  program,
1,662,500 shares remain  authorized for purchase.  There were 57,978,000  common
shares outstanding at September 30, 1999.
<PAGE>
                                      -16-

     SUBSEQUENT EVENT

     On October 22, 1999, we announced  the  completion of our offer to exchange
$7.61 in cash and 0.2203  Phelps  Dodge  shares  for each  share of Cyprus  Amax
Minerals  Company  (Cyprus Amax) on a fully prorated  basis.  The exchange offer
expired at 12:00 midnight, eastern time, October 15, 1999.

     We were informed by Chase Mellon Shareholder  Services,  the exchange agent
for the offer,  that 81.5  million  shares of Cyprus  Amax  stock were  tendered
representing  89.6 percent of the  outstanding  shares of Cyprus  Amax.  (Please
refer to Note 9 to the Consolidated Financial Information for further discussion
of this transaction.)

PART II. OTHER INFORMATION


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Any  exhibits  required  to be filed by the  company are listed in the
          Index to Exhibits.

     (b)  The company  filed six  reports on Form 8-K during the  quarter  ended
          September  30,  1999.  The  following is a list of the filings and the
          date they were filed.

          Phelps  Dodge filed a Current  Report on Form 8-K on August 23,  1999,
          with respect to a press release  issued on August 20, 1999,  proposing
          the  acquisition  of Asarco  Incorporated  and  Cyprus  Amax  Minerals
          Company.

          Phelps  Dodge filed a Current  Report on Form 8-K on August 23,  1999,
          with respect to a press release  issued on August 20, 1999,  proposing
          the  acquisition  of Asarco  Incorporated  and  Cyprus  Amax  Minerals
          Company that was posted on Phelps Dodge's internet site.

          Phelps  Dodge filed a Current  Report on Form 8-K on August 26,  1999,
          with respect to a press release issued on August 25, 1999,  related to
          the  proposed  acquisition  of Asarco  Incorporated  and  Cyprus  Amax
          Minerals Company.

          Phelps Dodge filed a Current  Report on Form 8-K on September 3, 1999,
          with respect to press releases  issued on September 2 and 3, 1999, and
          an investor slide presentation dated September 3, 1999, related to the
          proposed  acquisition of Asarco  Incorporated and Cyprus Amax Minerals
          Company.

          Phelps Dodge filed a Current Report on Form 8-K on September 22, 1999,
          with respect to a press release  issued on September 22, 1999,  and an
          investor slide  presentation  dated September 22, 1999, related to the
          proposed  acquisition of Asarco  Incorporated and Cyprus Amax Minerals
          Company.

          Phelps Dodge filed a Current Report on Form 8-K on September 30, 1999,
          with respect to a press  release  dated  September  30,  1999,  and an
          Agreement  and Plan of Merger  among  Phelps  Dodge  Corporation,  CAV
          Corporation and Cyprus Amax Minerals Company dated September 30, 1999.
<PAGE>
                                      -17-

SIGNATURES

     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, we
have duly caused this report to be signed on its behalf by the undersigned  duly
authorized officer.


                            PHELPS DODGE CORPORATION
                           (Corporation or Registrant)


Date: November 12, 1999

By:   /s/ Stanton K. Rideout
      --------------------------------
      Stanton K. Rideout
      Vice President and Controller
      (Principal Accounting Officer)


INDEX TO EXHIBITS

10.10     First  Amendment  to  the  Phelps  Dodge  Supplemental  Savings  Plan,
          effective as of January 1, 1999 (SEC File No. 1-82).

12        Computation of ratios of total debt to total capitalization.

15        Letter  from  PricewaterhouseCoopers  LLP with  respect  to  unaudited
          interim financial information.