##### Table of Contents



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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 March 31, 2000

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 May 9, 2000:  78,721,000 shares.



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TABLE OF CONTENTS



|                                              |                                                                              |  |  |  |  |  |  | 
|--------------------------------------------- | ---------------------------------------------------------------------------- |  |  |  |  |  |  | 
|Part I. Financial Information                
|Item 1. Financial Statements                 
|                                              | Statement of Consolidated Operations                                        
|                                              | Consolidated Balance                                                        
|                                              | Consolidated Statement of Cash Flows                                        
|                                              | Consolidated Statement of Common Shareholders' Equity                       
|                                              | Consolidated Statement of Common Shareholders' Equity                       
|                                              | Notes to Consolidated Financial Information                                 
|                                              | Review by Independent Accountants                                           
|                                              | Report of Independent Accountants on Review on 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 1.  Legal Proceedings                   
|Item 6.  Exhibits and Reports on Form 8-K    
|Signatures                                   
|Index to Exhibits                            



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##### Table of Contents



i

PHELPS DODGE CORPORATIONQuarterly Report on Form 10-QFor the Quarter Ended March 31, 2000Table of Contents

|                              |                                              |                                                                             
|----------------------------- | -------------------------------------------- | ----------------------------------------------------------------------------
|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 1. Legal Proceedings                   
|                             
|                             
|                             
|                             
|                              | Item 6. Exhibits and Reports on Form 8-K    
|                             
|                             
|                             
|                             
|                              | Signatures                                  
|                             
|                             
|                             
|                             
|                              | Index to Exhibits                           





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- 1 -

PHELPS DODGE CORPORATION AND SUBSIDIARIES
Part I. Financial Information

|                                                                                                                                          |                                                         |               |         |       |      |  |       |       |  
|----------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------- | ------------- | ------- | ----- | ---- |  | ----- | ----- | -
|Item 1. Financial Statements                                                                                                              |                                                         | First Quarter
|                                                                                                                                          |                                                         |              
|                                                                                                                                          |                                                         |               | 2000    |       | 1999
|                                                                                                                                          |                                                         |               |         |       |     
|STATEMENT OF CONSOLIDATED OPERATIONS                                                                                                     
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|(Unaudited; in millions except per share data)                                                                                           
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|Sales and other operating revenues                                                                                                        |                                                         | $             | 1,119.7 |       |      |  | 663.1 |      
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Operating costs and expenses                                                                                                             
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Cost of products sold (see Note 3)                      |               |         | 873.4 |      |  |       | 529.0 |  
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Depreciation, depletion and amortization                |               |         | 119.4 |      |  |       | 73.2  |  
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Selling and general administrative expense (see Note 3) |               |         | 32.2  |      |  |       | 24.5  |  
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Exploration and research expense                        |               |         | 12.8  |      |  |       | 8.8   |  
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Non-recurring charges and other (see Note 6)            |               |         | 2.1   |      |  |       |      |  
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|                                                                                                                                          |                                                         |               | 1,039.9 |       |      |  | 635.5 |      
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Operating income                                                                                                                          |                                                         |               | 79.8    |       |      |  | 27.6  |      
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Interest expense                                        |               |         | (55.4 | )    |  |       | (24.1 | )
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Capitalized interest                                    |               |         | 0.4   |      |  |       | 0.1   |  
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Miscellaneous income and expense, net                   |               |         | 6.4   |      |  |       | (7.4  | )
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Income (loss) before taxes, minority interests, equity in net earnings
of affiliated companies and cumulative effect of accounting change |                                                         |               | 31.2    |       |      |  | (3.8  | )    
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Provision for taxes on income                           |               |         | (11.2 | )    |  |       | (1.4  | )
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Minority interests in consolidated subsidiaries         |               |         | (1.4  | )    |  |       | (0.4  | )
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Equity in net earnings of affiliated companies          |               |         | 0.8   |      |  |       | 6.1   |  
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Income before cumulative effect of accounting change                                                                                      |                                                         |               | 19.4    |       |      |  | 0.5   |      
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Cumulative effect of accounting change (see Note 7)     |               |         |      |      |  |       | (3.5  | )
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Net income (loss)                                                                                                                         |                                                         | $             | 19.4    |       |      |  | (3.0  | )    
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Average number of shares outstanding  basic                                                                                              |                                                         |               | 78.4    |       |      |  | 57.8  |      
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|Basic earnings per share before cumulative effect of accounting change                                                                    |                                                         | $             | 0.25    |       |      |  | 0.01  |      
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Cumulative effect of accounting change (see Note 7)     |               |         |      |      |  |       | (0.06 | )
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Basic earnings (loss) per share                                                                                                           |                                                         | $             | 0.25    |       |      |  | (0.05 | )    
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Average number of shares outstanding  diluted                                                                                            |                                                         |               | 78.8    |       |      |  | 57.9  |      
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|Diluted earnings per share before cumulative effect of accounting change                                                                  |                                                         | $             | 0.25    |       |      |  | 0.01  |      
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                          | Cumulative effect of accounting change (see Note 7)     |               |         |      |      |  |       | (0.06 | )
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      
|Diluted earnings (loss) per share                                                                                                         |                                                         | $             | 0.25    |       |      |  | (0.05 | )    
|                                                                                                                                          |                                                         |               |         |       |      |  |       |      

See Notes to Consolidated Financial Information.





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- 2 -

CONSOLIDATED BALANCE SHEET
(Unaudited; in millions)

|                                                |                                                        |                     |         |           |         |              |         |         |         | 
|----------------------------------------------- | ------------------------------------------------------ | ------------------- | ------- | --------- | ------- | ------------ | ------- | ------- | ------- | 
|                                                |                                                        |                     |         | March 31, |         | December 31,
|                                                |                                                        |                     |         | 2000      |         | 1999        
|                                                |                                                        |                     |         |           |         |             
|Assets                                         
|                                               
|                                               
|                                               
|                                               
|                                                | Cash and cash equivalents                              |                     | $       | 311.6     |         |              |         | 234.2   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Accounts receivable, net                               |                     |         | 557.7     |         |              |         | 541.5   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Inventories                                            |                     |         | 461.9     |         |              |         | 498.3   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Supplies                                               |                     |         | 149.3     |         |              |         | 149.0   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Other current assets and prepaid expenses (see Note 9) |                     |         | 49.4      |         |              |         | 172.4   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Deferred income taxes                                  |                     |         | 101.5     |         |              |         | 98.0    |        
|                                                |                                                        |                     |         |           |         |              |         |        
|                                                |                                                        | Current assets      |         |           | 1,631.4 |              |         |         | 1,693.4 | 
|                                               
|                                               
|                                               
|                                               
|                                                | Investments and long-term accounts receivable          |                     |         | 133.1     |         |              |         | 136.1   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Property, plant and equipment, net                     |                     |         | 5,999.7   |         |              |         | 6,037.7 |        
|                                               
|                                               
|                                               
|                                               
|                                                | Non-current deferred income taxes                      |                     |         | 16.9      |         |              |         | 16.9    |        
|                                               
|                                               
|                                               
|                                               
|                                                | Other assets and deferred charges                      |                     |         | 345.9     |         |              |         | 344.9   |        
|                                                |                                                        |                     |         |           |         |              |         |        
|                                                |                                                        | $                   | 8,127.0 |           |         |              | 8,229.0 |        
|                                                |                                                        |                     |         |           |         |              |         |         |        
|Liabilities                                    
|                                               
|                                               
|                                               
|                                               
|                                                | Short-term debt                                        |                     | $       | 374.7     |         |              |         | 451.2   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Current portion of long-term debt                      |                     |         | 115.4     |         |              |         | 131.3   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Accounts payable and accrued expenses                  |                     |         | 801.8     |         |              |         | 786.5   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Accrued income taxes                                   |                     |         | 26.0      |         |              |         | 49.3    |        
|                                                |                                                        |                     |         |           |         |              |         |        
|                                                |                                                        | Current liabilities |         |           | 1,317.9 |              |         |         | 1,418.3 | 
|                                               
|                                               
|                                               
|                                               
|                                                | Long-term debt                                         |                     |         | 2,173.9   |         |              |         | 2,172.5 |        
|                                               
|                                               
|                                               
|                                               
|                                                | Deferred income taxes                                  |                     |         | 396.3     |         |              |         | 385.7   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Other liabilities and deferred credits                 |                     |         | 879.7     |         |              |         | 879.4   |        
|                                                |                                                        |                     |         |           |         |              |         |        
|                                                |                                                        |                     | 4,767.8 |           |         |              | 4,855.9 |        
|                                                |                                                        |                     |         |           |         |              |         |        
|Minority interests in consolidated subsidiaries |                                                        |                     | 99.1    |           |         |              | 96.3    |        
|                                                |                                                        |                     |         |           |         |              |         |        
|Common shareholders equity                    
|                                               
|                                               
|                                               
|                                               
|                                                | Common shares, 78.7 outstanding (12/31/99 - 78.7)      |                     |         | 492.0     |         |              |         | 491.6   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Capital in excess of par value                         |                     |         | 1,019.0   |         |              |         | 1,016.4 |        
|                                               
|                                               
|                                               
|                                               
|                                                | Retained earnings                                      |                     |         | 1,939.8   |         |              |         | 1,959.8 |        
|                                               
|                                               
|                                               
|                                               
|                                                | Accumulated other comprehensive income (loss)          |                     |         | (178.1    | )       |              |         | (180.3  | )      
|                                               
|                                               
|                                               
|                                               
|                                                | Other                                                  |                     |         | (12.6     | )       |              |         | (10.7   | )      
|                                                |                                                        |                     |         |           |         |              |         |        
|                                                |                                                        |                     | 3,260.1 |           |         |              | 3,276.8 |        
|                                                |                                                        |                     |         |           |         |              |         |        
|                                                |                                                        | $                   | 8,127.0 |           |         |              | 8,229.0 |        
|                                                |                                                        |                     |         |           |         |              |         |         |        

See Notes to Consolidated Financial Information.





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- 3 -

CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited; in millions)

|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |       |      |        |  
|------------------------------------------------ | --------------------------------------------------------------------------------- | ------------------------------------------------- | --------------------------------------------------- | ----- | ---------------------------- | ------ | ----- | ----- | ---- | ------ | -
|                                                 |                                                                                   |                                                   |                                                     |       | Three months ended March 31,
|                                                 |                                                                                   |                                                   |                                                     |       |                             
|                                                 |                                                                                   |                                                   |                                                     |       | 2000                         |        | 1999 
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |      
|Operating activities                            
|                                                
|                                                
|                                                
|                                                
|                                                 | Net income (loss)                                                                 |                                                   | $                                                   | 19.4  |                              |        |       | (3.0  | )   
|                                                
|                                                
|                                                
|                                                
|                                                 | Adjustments to reconcile net income to net cash
provided by operating activities:
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   | Depreciation, depletion and amortization          |                                                     |       | 119.4                        |        |       |       | 73.2 |       
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   | Deferred income taxes                             |                                                     |       | 6.3                          |        |       |       | (1.3 | )     
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   | Equity earnings net of dividends received         |                                                     |       | (0.2                         | )      |       |       | (6.1 | )     
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   | Changes in current assets and liabilities:       
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | (Increase) decrease in accounts receivable          |       |                              | (6.3   | )     |       |      | (32.4  | )
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | (Increase) decrease in inventories                  |       |                              | 24.9   |       |       |      | 16.0   |  
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | (Increase) decrease in supplies                     |       |                              | (0.5   | )     |       |      | 2.4    |  
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | (Increase) decrease in prepaid expenses             |       |                              | (17.0  | )     |       |      |       |  
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | (Increase) decrease in deferred income taxes        |       |                              | (0.1   | )     |       |      | (0.4   | )
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | Increase (decrease) in interest payable             |       |                              | 22.2   |       |       |      | 14.0   |  
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | Increase (decrease) in other accounts payable       |       |                              | 15.9   |       |       |      | (36.7  | )
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | Increase (decrease) in accrued income taxes         |       |                              | (22.6  | )     |       |      | (5.0   | )
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   |                                                   | Increase (decrease) in other accrued expenses       |       |                              | (32.3  | )     |       |      | (5.3   | )
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   | Non-recurring charges and provisions (see Note 6) |                                                     |       | 2.1                          |        |       |       |     |       
|                                                
|                                                
|                                                
|                                                
|                                                 |                                                                                   | Other adjustments, net                            |                                                     |       | (6.9                         | )      |       |       | 8.8  |       
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |      
|                                                 |                                                                                   |                                                   | Net cash provided by operating activities           |       |                              | 124.3  |       |       |      | 24.2   |  
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |      
|Investing activities                            
|                                                
|                                                
|                                                
|                                                
|                                                 | Capital outlays                                                                   |                                                   |                                                     | (62.2 | )                            |        |       | (30.5 | )   
|                                                
|                                                
|                                                
|                                                
|                                                 | Capitalized interest                                                              |                                                   |                                                     | (0.4  | )                            |        |       | (0.1  | )   
|                                                
|                                                
|                                                
|                                                
|                                                 | Investment in subsidiaries                                                        |                                                   |                                                     | (7.5  | )                            |        |       | (75.7 | )   
|                                                
|                                                
|                                                
|                                                
|                                                 | Proceeds from asset dispositions and other (see Note 9)                           |                                                   |                                                     | 149.4 |                              |        |       | 0.3   |     
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |      
|                                                 |                                                                                   |                                                   | Net cash provided by (used in) investing activities |       |                              | 79.3   |       |       |      | (106.0 | )
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |      
|Financing activities                            
|                                                
|                                                
|                                                
|                                                
|                                                 | Increase in debt                                                                  |                                                   |                                                     | 5.2   |                              |        |       | 109.1 |     
|                                                
|                                                
|                                                
|                                                
|                                                 | Payment of debt                                                                   |                                                   |                                                     | (93.3 | )                            |        |       | (23.3 | )   
|                                                
|                                                
|                                                
|                                                
|                                                 | Common dividends                                                                  |                                                   |                                                     | (39.4 | )                            |        |       | (29.0 | )   
|                                                
|                                                
|                                                
|                                                
|                                                 | Other, net                                                                        |                                                   |                                                     | 1.3   |                              |        |       | (0.1  | )   
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |      
|                                                 |                                                                                   |                                                   | Net cash provided by (used in) financing activities |       |                              | (126.2 | )     |       |      | 56.7   |  
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |      
|Increase (decrease) in cash and cash equivalents |                                                                                   |                                                   | 77.4                                                |       |                              |        | (25.1 | )    
|                                                
|                                                
|                                                
|                                                
|Cash and cash equivalents at beginning of year   |                                                                                   |                                                   | 234.2                                               |       |                              |        | 221.7 |      
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |      
|Cash and cash equivalents at end of period       |                                                                                   | $                                                 | 311.6                                               |       |                              |        | 196.6 |      
|                                                 |                                                                                   |                                                   |                                                     |       |                              |        |       |       |     

See Notes to Consolidated Financial Information.





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##### Table of Contents









- 4 -

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

|                             |                               |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  |     |        |      |   |   |         |       |      |     | 
|---------------------------- | ----------------------------- | --------------------------------------- | ------------------------------ | - | ------------- | - | ---------- | --- | --------- | - | -------- | ---- | ------------- | - | ----------- | ----- | ------ |  | ------------- | - |  | --- | ------ | ---- | - | - | ------- | ----- | ---- | --- | 
|                             |                               |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   | 
|                             |                               |                                         |                                |   | 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
|                             |                               |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |       
|Balance at December 31, 1999 |                               |                                         | 78.7                           |   |               | $ | 491.6      |     |           | $ | 1,016.4  |      |               | $ | 1,959.8     |       |        |  | ($180.3       | ) |  |     | ($10.7 | )    |   | $ | 3,276.8 |      
|                            
|                            
|                            
|                            
|                             | Stock options exercised       |                                         |                                |  |               |   |            | 0.1 |           |   |          | 0.9  |               |   |             |      |        |  |               |   |  |     |        |      |   |   |         | 1.0   |     
|                            
|                            
|                            
|                            
|                             | Restricted shares issued, net |                                         |                                |  |               |   |            | 0.3 |           |   |          | 2.3  |               |   |             |      |        |  |               |   |  |     |        | (1.9 | ) |   |         | 0.7   |     
|                            
|                            
|                            
|                            
|                             | Other investment adjustments  |                                         |                                |   |               |   |            |     |           |   |          | (0.6 | )             |   |             |      |        |  |               |   |  |     |        |      |   |   |         | (0.6  | )   
|                            
|                            
|                            
|                            
|                             | Dividends on common shares    |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             | (39.4 | )      |  |               |   |  |     |        |      |   |   |         | (39.4 | )   
|                            
|                            
|                            
|                            
|                             | Comprehensive income:        
|                            
|                            
|                            
|                            
|                             |                               | Net income                              |                                |   |               |   |            |     |           |   |          |      |               |   |             |       | 19.4   |  |               |   |  |     |        |      |   |   |         |       | 19.4 |    
|                            
|                            
|                            
|                            
|                             |                               | Other comprehensive income,
net of tax:
|                            
|                            
|                            
|                            
|                             |                               |                                         | Translation adjustment         |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  | 1.7 |        |      |   |   |         |       |      | 1.7 | 
|                            
|                            
|                            
|                            
|                             |                               |                                         | Unrealized gains on securities |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  | 0.5 |        |      |   |   |         |       |      | 0.5 | 
|                             |                               |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  |     |        |      |   |   |         |      
|                             |                               |                                         | Other comprehensive income     |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  | 2.2 |        |      |   |   |         |       |      | 2.2 | 
|                             |                               |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  |     |        |      |   |   |         |      
|                             |                               | Comprehensive income                    |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  |     |        |      |   |   |         |       | 21.6 |    
|                             |                               |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  |     |        |      |   |   |         |      
|Balance at March 31, 2000    |                               |                                         | 78.7                           |   |               | $ | 492.0      |     |           | $ | 1,019.0  |      |               | $ | 1,939.8     |       |        |  | ($178.1       | ) |  |     | ($12.6 | )    |   | $ | 3,260.1 |      
|                             |                               |                                         |                                |   |               |   |            |     |           |   |          |      |               |   |             |       |        |  |               |   |  |     |        |      |   |   |         |      

See Notes to Consolidated Financial Information.





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##### Table of Contents









- 5 -

FINANCIAL DATA BY BUSINESS SEGMENT



|                 |                                   |                        |  |               |       |        |  |               |       |          |  |               |       |        |  |         |       |  |  |         |         |  |  |       |       |   |  |         |         | 
|---------------- | --------------------------------- | ---------------------- |  | ------------- | ----- | ------ |  | ------------- | ----- | -------- |  | ------------- | ----- | ------ |  | ------- | ----- |  |  | ------- | ------- |  |  | ----- | ----- | - |  | ------- | ------- | 
|                 |                                   |                        |  |               |       |        |  |               |       |         
|                 |                                   |                        |  | PD Industries |       |        |  | Corporate     |       |         
|                 |                                   | Phelps                 |  |               |       |        |  | Unallocated & |       |         
|                 |                                   | Dodge                  |  | Specialty     |       | Wire & |  |               |       | Segment  |  | Reconciling   |       |       
|                 |                                   | Mining                 |  | Chemicals     |       | Cable  |  | Total         |       | Subtotal |  | Eliminations* |       | Totals
|                 |                                   |                        |  |               |       |        |  |               |       |          |  |               |       |       
|1st Quarter 2000 |                                   |                        |  |               |       |        |  |               |       |          |  |               |       |        |  |         |       |  |  |         |         |  |  |       |       |   |  |        
|                
|                
|                
|                
|                 | Sales & other operating revenues: |                        |  |               |       |        |  |               |       |          |  |               |       |        |  |         |       |  |  |         |         |  |  |       |       |   |  |         |        
|                
|                
|                
|                
|                 |                                   | Unaffiliated customers |  | $             | 753.4 |        |  |               | 154.9 |          |  |               | 211.4 |        |  |         | 366.3 |  |  |         | 1,119.7 |  |  |       |      |   |  |         | 1,119.7 | 
|                
|                
|                
|                
|                 |                                   | Intersegment           |  |               | 60.7  |        |  |               |      |          |  |               |      |        |  |         |      |  |  |         | 60.7    |  |  |       | (60.7 | ) |  |         |        | 
|                
|                
|                
|                
|                 | Non-recurring charges             |                        |  |              |       |        |  |              |       |          |  | 2.1           |       |        |  | 2.1     |       |  |  | 2.1     |         |  |  |      |       |   |  | 2.1     |        
|                
|                
|                
|                
|                 | Operating income (loss)           |                        |  | 68.3          |       |        |  | 24.7          |       |          |  | 2.2           |       |        |  | 26.9    |       |  |  | 95.2    |         |  |  | (15.4 | )     |   |  | 79.8    |        
|                
|                
|                
|                
|                 | Assets at March 31                |                        |  | 6,357.3       |       |        |  | 781.0         |       |          |  | 769.6         |       |        |  | 1,550.6 |       |  |  | 7,907.9 |         |  |  | 219.1 |       |   |  | 8,127.0 |        
|                 |                                   |                        |  |               |       |        |  |               |       |          |  |               |       |        |  |         |       |  |  |         |         |  |  |       |       |   |  |        
|1st Quarter 1999 |                                   |                        |  |               |       |        |  |               |       |          |  |               |       |        |  |         |       |  |  |         |         |  |  |       |       |   |  |        
|                
|                
|                
|                
|                 | Sales & other operating revenues: |                        |  |               |       |        |  |               |       |          |  |               |       |        |  |         |       |  |  |         |         |  |  |       |       |   |  |         |        
|                
|                
|                
|                
|                 |                                   | Unaffiliated customers |  | $             | 344.1 |        |  |               | 131.0 |          |  |               | 188.0 |        |  |         | 319.0 |  |  |         | 663.1   |  |  |       |      |   |  |         | 663.1   | 
|                
|                
|                
|                
|                 |                                   | Intersegment           |  |               | 51.8  |        |  |               |      |          |  |               |      |        |  |         |      |  |  |         | 51.8    |  |  |       | (51.8 | ) |  |         |        | 
|                
|                
|                
|                
|                 | Operating income (loss)           |                        |  | 5.1           |       |        |  | 30.5          |       |          |  | 4.3           |       |        |  | 34.8    |       |  |  | 39.9    |         |  |  | (12.3 | )     |   |  | 27.6    |        
|                
|                
|                
|                
|                 | Assets at March 31                |                        |  | 3,200.6       |       |        |  | 765.7         |       |          |  | 843.5         |       |        |  | 1,609.2 |       |  |  | 4,809.8 |         |  |  | 151.2 |       |   |  | 4,961.0 |        
|                 |                                   |                        |  |               |       |        |  |               |       |          |  |               |       |        |  |         |       |  |  |         |         |  |  |       |       |   |  |        




| |   |                                                                                             
| | - | --------------------------------------------------------------------------------------------
| | * | Represents corporate, unallocated and reconciling elimination
        activities and assets.



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##### Table of Contents









- 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, 1999. 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 period ended March 31,
2000, are not necessarily indicative of the results to be expected for the
full year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|3. |  | The 1999 first quarter reflects the reclassification of $4.9 million in
operation support costs from selling and general administrative expenses
to cost of products sold to conform to the current year presentation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|  
|4. |  | 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. As of March 31, 2000, the company had a total of
approximately 110 million pounds of year 2000 copper cathode production
under various price protection agreements with various financial
institutions. These annual contracts effectively ensure minimum
(approximately 72 cents) and maximum (approximately 95 cents) prices per
pound. Additionally, monthly minimum priced contracts covering
approximately 200 million pounds of first quarter 2000 copper cathode
expired without payment to Phelps Dodge. The minimum and maximum prices
are based on the average London Metal Exchange price for the protection
period.                                                      
|  
|5. |  | Cyprus Amax Acquisition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|  
|   |  | Liabilities recorded in the acquisition of Cyprus Amax included costs of
$22 million associated with merging Cyprus Amaxs operations into the
companys operations (e.g., lease and other cancellation costs and
employee termination costs, primarily for duplicate administrative and
management functions). Through March 31, 2000, we have paid $7 million
for such costs, including approximately $6 million for employee
termination and severance costs. Costs for these liabilities are expected
to be substantially paid out by the end of 2000.                                                                                                                                                                                                                                                                                                                                                           
|  
|6. |  | 1999 Restructuring Charges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|   |  | 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 our carbon black plant in the Philippines. These
actions resulted in a total non-recurring, pre-tax charge of $96.7 million
(or $65.7 million, $1.07 per share, after taxes and minority interests) in
1999 and $2.1 million (or $1.3 million, 1 cent per share, after taxes) in
the 2000 first quarter.
|  
|   |  | Our mining segment had no charges in the 2000 first quarter from the June
30, 1999, restructuring plan. The current liability components of the
restructuring plan for the mining segment related to employee severance,
mothballing and take or pay contracts during the first quarter of 2000
were as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

---

|                      |                        |  |           |     |           |  |              |     |  |  |      |     | 
|--------------------- | ---------------------- |  | --------- | --- | --------- |  | ------------ | --- |  |  | ---- | --- | 
|(in millions)        
|                      |                        |  |           |     |           |  | Mothballing/
|                      |                        |  |           |     |           |  | Take or     
|                      |                        |  | Employee  |     | Pay      
|                      |                        |  | Severance |     | Contracts |  | Total       
|                      |                        |  |           |     |           |  |             
|Dec. 31, 1999 balance |                        |  | 1.4       |     |           |  | 3.5          |     |  |  | 4.9  |    
|                     
|                     
|                     
|                     
|Payments made         |                        |  | (0.4      | )   |           |  | (0.3         | )   |  |  | (0.7 | )  
|                      |                        |  |           |     |           |  |              |     |  |  |      |    
|                      | March 31, 2000 balance |  |           | 1.0 |           |  |              | 3.2 |  |  |      | 4.2 | 
|                      |                        |  |           |     |           |  |              |     |  |  |      |    

---



| |  | Our specialty chemicals segment had no charges in the 2000 first quarter
from the June 30, 1999, restructuring plan. The current liability
components of the restructuring plan
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---



##### Table of Contents



- 7 -



| |  | for our specialty chemicals segment
related to employee severance and disposal and dismantling costs during
the first quarter of 2000 were as follows:
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------

---

|                       |                                     |  |           |      |             |  |          |      |   |  |     |      |  
|---------------------- | ----------------------------------- |  | --------- | ---- | ----------- |  | -------- | ---- | - |  | --- | ---- | -
|(in millions)         
|                       |                                     |  |           |      |             |  | Disposal
|                       |                                     |  | Employee  |      | and        
|                       |                                     |  | Severance |      | Dismantling |  | Total   
|                       |                                     |  |           |      |             |  |         
|                       | Dec. 31, 1999 balance               |  |           | 1.0  |             |  |          | 1.9  |   |  |     | 2.9  |  
|                      
|                      
|                      
|                      
|                       | Reclassification of the
restructure |  |           | (0.6 | )           |  |          |     |   |  |     | (0.6 | )
|                      
|                      
|                      
|                      
|                       | Payments made                       |  |           |     |             |  |          | (0.3 | ) |  |     | (0.3 | )
|                       |                                     |  |           |      |             |  |          |      |   |  |     |      |  
|March 31, 2000 balance |                                     |  | 0.4       |      |             |  | 1.6      |      |   |  | 2.0 |     
|                       |                                     |  |           |      |             |  |          |      |   |  |     |      |  

---



| |  | Our wire and cable segment had non-recurring, pre-tax charges of $2.1
million in the 2000 first quarter from the restructuring plan. The
components of the restructuring plan related to employee severance and
disposal and dismantling costs during the 2000 first quarter were as
follows:
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|                      |                        |  |             |     |             |  |           |     |  |  |      |     | 
|--------------------- | ---------------------- |  | ----------- | --- | ----------- |  | --------- | --- |  |  | ---- | --- | 
|(in millions)        
|                      |                        |  |             |     |             |  | Equipment
|                      |                        |  |             |     |             |  | Disposal,
|                      |                        |  | Employee    |     | Dismantling
|                      |                        |  | Severance & |     | &          
|                      |                        |  | Relocation  |     | Relocation  |  | Total    
|                      |                        |  |             |     |             |  |          
|Dec. 31, 1999 balance |                        |  | 3.2         |     |             |  | 1.0       |     |  |  | 4.2  |    
|                     
|                     
|                     
|                     
|Relocation expenses * |                        |  | 0.4         |     |             |  | 1.4       |     |  |  | 1.8  |    
|                     
|                     
|                     
|                     
|Additional severance  |                        |  | 0.3         |     |             |  |          |     |  |  | 0.3  |    
|                     
|                     
|                     
|                     
|Payments made         |                        |  | (0.9        | )   |             |  | (1.4      | )   |  |  | (2.3 | )  
|                      |                        |  |             |     |             |  |           |     |  |  |      |    
|                      | March 31, 2000 balance |  |             | 3.0 |             |  |           | 1.0 |  |  |      | 4.0 | 
|                      |                        |  |             |     |             |  |           |     |  |  |      |    



---

|* |  | Relocation costs are charged to expense as incurred.
|- |  | ----------------------------------------------------

---



|   |  | The first quarter 2000 non-recurring, after-tax charges of $2.1 million
were principally for expenses to relocate equipment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|7. |  | Accounting Standards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|  
|   |  | In June 1998, the Financial Accounting Standards Board (FASB) 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 FASB has delayed its
effective date for one year. We will adopt SFAS No. 133 in the first
quarter of 2001. We are evaluating the effect this statement will have on
our financial reporting and disclosures as well as on our derivative and
hedging activities.
|  
|   |  | 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 Mexico.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|  
|   |  | In December 1999, the Securities and Exchange Commission (SEC) issued
Staff Accounting Bulletin (SAB) No. 101, Revenue Recognition that
provides guidance on the recognition, presentation and disclosure of
revenue in financial statements filed with the SEC. SAB No. 101 outlines
the basic criteria that must be met to recognize revenue and provides
guidance for disclosures related to revenue recognition policies. We will
adopt SAB No. 101 in the 2000 second quarter. We are evaluating the
effect this bulletin may have, if any, on our consolidated financial
statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|  
|   |  | The Emerging Issues Task Force (EITF) issued Topic No. D-88, Planned
Major Maintenance Activities on March 16, 2000. Topic D-88 requires
companies to disclose in their Form 10-Qs for 2000, their accounting
policy for repair and maintenance costs incurred in connection with
planned major maintenance activities. Our policy for repair and
maintenance costs incurred in connection with planned major maintenance
activities is to charge to operations such costs equally over the twelve
months of the year in which the major maintenance activities are incurred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|  
|8. |  | Environmental Matters                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               





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##### Table of Contents



- 8 -



|    |  | As of December 31, 1999, we had a reserve balance of $336.1 million for
estimated future costs associated with environmental matters. During the
first three months of 2000, net spending against that reserve totaled
$10.7 million. As of March 31, 2000, the reserve balance was $325.4
million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | The company has contingencies regarding environmental, closure and other
matters. For a further discussion of these contingencies please see Note
19 to the Consolidated Financial Statements of the companys 1999 Form
10-K.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   
|9.  |  | Asset Sales                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|    |  | On March 30, 2000, we sold Cyprus Australia Coal Company, a wholly owned
subsidiary, to Glencore Coal Australia Pty. Ltd., a subsidiary of
Switzerland-based Glencore International AG, for US$150 million in cash.
We acquired Cyprus Australia Coal Company as part of our acquisition of
Cyprus Amax Minerals Company on October 16, 1999. Cyprus Australia Coal
Company owned 48 percent of Oakbridge Pty. Ltd. and 50 percent of the
Springvale Mine in Australia.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   
|10. |  | Debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|    |  | An agreement on a new, unsecured revolving credit facility was entered
into by the company and several lenders on May 10, 2000. The facility is
to be used for general corporate purposes, primarily as a commercial paper
backstop. This facility, which replaces the June 1997 agreement, permits
borrowings of up to $1 billion until its maturity on May 10, 2005. It
allows for one-year extensions beyond the maturity date under certain
circumstances. Interest is payable at a fluctuating rate based on the
agent banks base rate or a fixed rate based on the London Interbank
Offered Rate (LIBOR), or at fixed rates offered independently by the
several lenders, for maturities of from one month to twelve months. This
agreement provides for an annual facility fee of 15 basis points (0.15
percent) on total commitments. The agreement requires the company to
maintain minimum consolidated tangible net worth of $1.5 billion and
limits indebtedness to 60 percent of total consolidated capitalization.







REVIEW BY INDEPENDENT ACCOUNTANTS

The financial information as of March 31, 2000, and for the three-month
periods ended March 31, 2000 and 1999, included in Part I pursuant to Rule
10-01 of Regulation S-X has been reviewed by PricewaterhouseCoopers LLP
(PricewaterhouseCoopers), the companys 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.





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##### Table of Contents









- 9 -

PRICEWATERHOUSECOOPERS LLP
REPORT OF INDEPENDENT ACCOUNTANTS

April 24, 2000

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 March 31, 2000, and the related
consolidated statements of operations, of cash flows and of common
shareholders equity for the three-month periods ended March 31, 2000 and 1999.
These financial statements are 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 interim financial statements for them
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, 1999, and the related
consolidated statements of operations, of cash flows and of common
shareholders equity for the year then ended (not presented herein), and in our
report dated January 26, 2000 we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth
in the accompanying consolidated balance sheet as of December 31, 1999, is
fairly stated in all material respects in relation to the consolidated balance
sheet from which it has been derived.

PricewaterhouseCoopers LLP
Phoenix, Arizona





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##### Table of Contents









- 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, 1999.







RESULTS OF OPERATIONS

Earnings

The company had consolidated earnings in the 2000 first quarter of $20.7
million, or 26 cents per common share, before non-recurring, after tax charges
of $1.3 million, or 1 cent per share, from the companys restructuring plan
announced on June 30, 1999. By comparison, earnings for the first quarter of
1999 were $0.5 million, or 1 cent per share, before an after-tax charge of $3.5
million, or 6 cents per share, for the cumulative effect of an accounting
change associated with unamortized start-up costs (please refer to Note 7 to
the Consolidated Financial Information). After non-recurring charges, 2000
first quarter net income was $19.4 million, or 25 cents per share, compared
with a 1999 first quarter net loss of $3.0 million, or 5 cents per share.

Earnings before non-recurring items were more in the 2000 first quarter
than in the corresponding 1999 period principally as a result of higher average
copper prices partially offset by higher costs for petroleum products and the
effect of continued economic difficulties in Southeast Asia and Latin America.
The average spot price per pound of cathode copper on the New York Commodity
Exchange (COMEX) was approximately 18 cents per pound, or 28 percent, higher in
the first quarter of 2000 than the average price in the corresponding 1999
period. The higher costs for petroleum products increased our first quarter
2000 mining operating costs by approximately $7 million, or 1.1 cents per pound
compared with the first quarter of 1999.

The COMEX spot price per pound of copper cathode, upon which we base our
selling price, averaged 82 cents in the 2000 first quarter, compared with 64
cents in the corresponding 1999 period. From April 1 to May 9, 2000, the COMEX
price averaged 79 cents per pound, closing at 83 cents on May 9, 2000.

Any material change in the price we receive for copper, or in our unit
production costs, has a significant effect on our results. Our share of
current annual production is approximately 2.4 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, causes a variation in
annual operating income before taxes of approximately $24 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. See Note 4 to the Consolidated Financial Information for a
discussion of such contracts as of March 31, 2000.

Sales

Sales were $1,119.7 million in the 2000 first quarter, compared with
$663.1 million in the corresponding 1999 period. This increase principally
resulted from the higher average copper prices, combined with higher sales
volumes of copper, molybdenum and carbon black.

Business Segments

Results for 2000 and 1999 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; molybdenum operations from mining through manufacturing,
marketing and sales; other mining operations and investments; and worldwide
mineral exploration and development programs. Phelps Dodge Industries includes
our specialty chemicals segment and our wire and cable segment.





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##### Table of Contents









- 11 -

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, 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. PD Mining, at times, smelts and refines copper and produces
copper rod for others on a toll basis. PD Mining also is an integrated
producer of molybdenum, with mining, roasting and processing facilities
producing molybdenum concentrate as well as metallurgical and chemical
products. PD Mining also produces gold, silver, molybdenum and copper
chemicals as by-products, and sulfuric acid from our air quality control
facilities. This business segment also includes our worldwide mineral
exploration programs.

---

|                                                            |                                                   |   |               |       |      |  |       |       | 
|----------------------------------------------------------- | ------------------------------------------------- | - | ------------- | ----- | ---- |  | ----- | ----- | 
|                                                            |                                                   |   | First Quarter
|                                                            |                                                   |   |              
|                                                            |                                                   |   | 2000          |       | 1999
|Copper production (thousand short tons):                   
|                                                           
|                                                           
|                                                           
|                                                           
|                                                            | Total production                                  |   |               | 371.8 |      |  |       | 252.6 | 
|                                                           
|                                                           
|                                                           
|                                                           
|                                                            | Less minority participants shares *              |   |               | 67.4  |      |  |       | 43.3  | 
|                                                            |                                                   |   |               |       |      |  |       |       | 
|                                                            | Net Phelps Dodge share                            |   |               | 304.4 |      |  |       | 209.3 | 
|                                                            |                                                   |   |               |       |      |  |       |       | 
|Copper sales (thousand short tons):                        
|                                                           
|                                                           
|                                                           
|                                                           
|                                                            | Net Phelps Dodge share
from own mines             |   |               | 315.4 |      |  |       | 212.9 | 
|                                                           
|                                                           
|                                                           
|                                                           
|                                                            | Purchased copper                                  |   |               | 99.0  |      |  |       | 61.0  | 
|                                                            |                                                   |   |               |       |      |  |       |       | 
|                                                            | Total copper sales                                |   |               | 414.4 |      |  |       | 273.9 | 
|                                                            |                                                   |   |               |       |      |  |       |       | 
|New York Commodity Exchange                                
|                                                           
|                                                           
|                                                           
|                                                           
|                                                            | Average spot price per pound - copper cathodes    |   | $             | 0.82  |      |  |       | 0.64  | 
|                                                           
|                                                           
|                                                           
|                                                           
|Molybdenum production (million pounds)                      |                                                   |   | 12.7          |       |      |  | 0.2   |      
|                                                           
|                                                           
|                                                           
|                                                           
|Molybdenum sales (million pounds)                           |                                                   |   | 16.4          |       |      |  | 0.1   |      
|                                                           
|                                                           
|                                                           
|                                                           
|Metals Week                                                
|                                                           
|                                                           
|                                                           
|                                                           
|                                                            | Average dealer oxide price per pound - molybdenum |   | $             | 2.54  |      |  |       | 2.62  | 
|                                                            |                                                   |   | (in millions)
|                                                           
|                                                           
|                                                           
|                                                           
|Sales and other operating revenues
- unaffiliated customers |                                                   | $ | 753.4         |       |      |  | 344.1 |      
|                                                           
|                                                           
|                                                           
|                                                           
|Operating income                                            |                                                   | $ | 68.3          |       |      |  | 5.1   |      



---

|* |  | 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 indirect subsidiary of Sumitomo Metal Mining Co.,
Ltd. and Sumitomo Corporation, and (iv) a 49 percent interest in the El
Abra copper mining operation in Chile held by Corporacion Nacional del
Cobre de Chile (Codelco).
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

PD Mining  Sales

PD Mining sales and other operating revenues to unaffiliated customers
increased by $409.3 million, or 120 percent, in the 2000 first quarter compared
with the corresponding 1999 period. This variance primarily reflected the
effect of increased copper sales volumes ($230 million) as a result of the
October 16, 1999, acquisition of Cyprus Amax Minerals Company (Cyprus Amax),
increased average selling price for copper (approximately $100 million) and an
increase in molybdenum sales revenue as a result of the properties acquired as
part of Cyprus Amax acquisition ($68 million).

PD Mining  Operating Income

PD Mining reported operating income of $68.3 million in the 2000 first
quarter, compared with $5.1 million in the corresponding 1999 period. This
increase primarily reflected the higher average copper price for sales of
PD-mined copper (approximately $77 million) and higher sales volumes of PD
mined copper (approximately $22 million), partially offset by higher copper
production costs (approximately $34 million) and losses from molybdenum
operations ($3 million). Higher 2000 copper production costs when compared
with the first quarter of 1999 were primarily due to higher diesel fuel costs,
higher depreciation expenses and the effect of lower ore grades at our
Candelaria operation.

PD Mining  Other Matters

On May 8, 2000, we announced the curtailment of molybdenum production at
our Henderson mine in Colorado. This curtailment will reduce molybdenum
production by approximately 5 million pounds annually and result in a workforce
reduction of approximately 130 workers. The severance related costs associated
with the curtailment are expected to result in a non-recurring, pre-tax charge
of $4.3 million ($2.7 million or 3 cents per share after taxes).





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##### Table of Contents









- 12 -

RESULTS OF PHELPS DODGE INDUSTRIES

Phelps Dodge Industries (PD Industries), our manufacturing division,
produces engineered products principally for the global energy,
telecommunications, transportation 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 Chemicals
or Columbian). Our wire and cable segment consists of three worldwide product
line businesses including magnet wire, energy and telecommunications cables, and
specialty conductors.

---

| |                                                              |                     |       |               |       |      |       |  |       | 
| | ------------------------------------------------------------ | ------------------- | ----- | ------------- | ----- | ---- | ----- |  | ----- | 
| |                                                              |                     |       | First Quarter
| |                                                              |                     |       |              
| |                                                              |                     |       | 2000          |       | 1999
| |                                                              |                     |       |               |       |     
| |                                                              |                     |       | (in millions)
| | Sales and other operating revenues
- unaffiliated customers:
|
|
|
|
| |                                                              | Specialty chemicals |       | $             | 154.9 |      |       |  | 131.0 | 
|
|
|
|
| |                                                              | Wire and cable      |       |               | 211.4 |      |       |  | 188.0 | 
| |                                                              |                     |       |               |       |      |       |  |       | 
| |                                                              | $                   | 366.3 |               |       |      | 319.0 | 
| |                                                              |                     |       |               |       |      |       |  |       | 
| | Operating income:                                           
|
|
|
|
| |                                                              | Specialty chemicals |       | $             | 24.7  |      |       |  | 30.5  | 
|
|
|
|
| |                                                              | Wire and cable*     |       |               | 2.2   |      |       |  | 4.3   | 
| |                                                              |                     |       |               |       |      |       |  |       | 
| |                                                              | $                   | 26.9  |               |       |      | 34.8  | 
| |                                                              |                     |       |               |       |      |       |  |       | 



---

|* |  | Includes a pre-tax charge of $2.1 million in the 2000 first quarter for
costs associated with the June 30, 1999, restructuring plan.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------

---

PD Industries  Sales

PD Industries reported sales to unaffiliated customers of $366.3 million
in the 2000 first quarter, compared with $319.0 million in the corresponding
1999 period. The increase reflected higher sales both in the specialty
chemicals and wire and cable segments. The higher specialty chemicals sales
principally reflected higher volumes (5 percent higher) and higher average
selling prices. The higher wire and cable sales were primarily a result of
higher copper prices and higher sales volumes to the aerospace and geophysical
markets.

PD Industries  Operating Income

PD Industries reported 2000 first quarter operating income of $29.0
million before non-recurring, pre-tax charges of $2.1 million for costs
associated with the June 30, 1999, restructuring plan. Operating income in the
1999 first quarter was $34.8 million. The decrease from the 1999 first quarter
was principally due to the effect of higher feedstock costs at our specialty
chemicals segment as a result of increased petroleum prices.







OTHER MATTERS RELATING TO THE STATEMENT OF CONSOLIDATED OPERATIONS

Depreciation, Depletion and Amortization

Depreciation, depletion and amortization expense was $119.4 million in the
2000 first quarter, compared with $73.2 million in the corresponding 1999
period. The 2000 depreciation expense includes depreciation at the recently
acquired Cyprus Amax properties.

Selling and General Administrative Expense

Selling and general administrative expense was $32.2 million in the 2000
first quarter, compared with $24.5 million in the corresponding 1999 period.
The increase is primarily related to the addition of administrative functions
to support the recently acquired Cyprus Amax properties and the inclusion of
molybdenum selling expenses from the
Cyprus Amax properties. (Also, see Note 3 to the Consolidated Financial
Information for a brief discussion of reclassifications of 1999 expenses.)

Exploration and Research and Development Expense

Our 2000 first quarter exploration and research expense was $12.8 million,
an increase of $4.0 million from that in the 1999 first quarter. The increase
primarily reflected exploration spending in Brazil and Africa and higher
research spending.

Interest Expense

Net interest expense was $55.0 million in the 2000 first quarter compared
with $24.0 million in the 1999 first quarter. The increase primarily reflected
the assumption of Cyprus Amaxs debt.





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##### Table of Contents



- 13 -

Miscellaneous Income and Expense, Net

Miscellaneous income and expense, net, increased by $13.8 million in the
2000 first quarter compared with the corresponding 1999 period. This change
principally reflected currency exchange losses (especially in Brazil) in the
1999 first quarter and higher interest income in the 2000 first quarter.

Provision for Taxes on Income

The effective tax rate changed from a 37 percent negative rate in the
first quarter of 1999 to a 36 percent rate in the first quarter of 2000. The
negative rate in 1999 resulted primarily from permanent foreign income expense
items that do not vary proportionally with book income. Thus, as book income
decreased, the effect of these permanent differences was magnified and our
effective rate increased. The 36 percent effective rate in 2000 results from
the return to positive earnings which dilute the rate impact of these permanent
differences.

Equity Earnings

Equity in net earnings of affiliated companies decreased by $5.3 million
primarily due to the 1999 first quarter gain on the sale of land by our equity
basis Philippine wire and cable operation.







CHANGES IN FINANCIAL CONDITION

Debt

At March 31, 2000, our total debt was $2,664.0 million, compared with
$2,755.0 million at year-end 1999. The $91.0 million decrease principally
reflected the use of proceeds from the sale of the companys wholly owned
subsidiary, Cyprus Australia Coal Company for $150 million (please refer to
Note 9 to the Consolidated Financial Information). Our ratio of debt to total
capitalization was 44.2 percent at March 31, 2000, compared with 45.0 percent
at December 31, 1999.

An agreement on a new, unsecured revolving credit facility was entered
into by the company and several lenders on May 10, 2000. For a discussion of
this agreement, please see Note 10 to the Consolidated Financial Information.

Capital Expenditures and Investments

Capital expenditures and investments during the 2000 first quarter were
$44.9 million for PD Mining, $11.6 million for PD Industries and $13.2 million
for Corporate and other (primarily Cyprus acquisition costs). Capital
expenditures and investments in the corresponding 1999 period were $17.9
million for PD Mining and $87.4 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. The company
expects capital expenditures and
investments for the year 2000 to be approximately $350 million for PD
Mining, including $132 million for the companys share of the Morenci
mine-for-leach project, and approximately $100 million for PD Industries.

Dividends

On March 10, 2000, we paid a regular quarterly dividend of 50 cents per
share on our common shares for the 2000 first quarter; the total amount paid
was $39.4 million. On May 3, 2000, the Board of Directors declared a regular
dividend in the 2000 second quarter of 50 cents per common share. The dividend
is to be paid on June 9, 2000, to shareholders of record at the close of
business on May 18, 2000.

Share Purchases

This year through May 8, we have not purchased any of our shares under our
May 7, 1997, share purchase authorization. Under that program, 1.7 million
shares remain authorized for purchase. There were 78.7 million common shares
outstanding at March 31, 2000.





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##### Table of Contents



- 14 -

Other Matters

For a discussion of costs incurred associated with merging Cyprus Amaxs
operations into our operations, please refer to Note 5 of the Consolidated
Financial Information. For a discussion of the status of the current liability
components of the 1999 restructuring charges, please refer to Note 6 of the
Consolidated Financial Information. For a discussion of new accounting
standards, please refer to Note 7 of the Consolidated Financial Information.







Part II. Other Information







Item 1. Legal Proceedings

On February 28, 2000, Cobre Mining Company (Cobre) received an
Administrative Order (Docket No. CWA-6-1014-00, the Order) from the U.S.
Environmental Protection Agency (EPA). The Order alleges violations of the
Clean Water Act, requires Cobre to deliver a response stating the steps it has
taken to address each of the incidents leading to the alleged violations, and
requires Cobre to show cause why no further action is necessary. Cobre has
submitted its response to the EPA. The response contends that actions already
taken adequately address the EPAs concerns and that further action is not
necessary.







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) No reports on Form 8-K were filed by us during the quarter
ended March 31, 2000.     







Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Corporation has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

PHELPS DODGE CORPORATION
(Corporation or Registrant)

|                   |  |                               
|------------------ |  | ------------------------------
|Date: May 12, 2000 |  | By:      Stanton K. Rideout   
|                  
|                  
|                  
|                  
|                   |  | Stanton K. Rideout            
|                  
|                  
|                  
|                  
|                   |  | Vice President and Controller 
|                  
|                  
|                  
|                  
|                   |  | (Principal Accounting Officer)







Index to Exhibits

|      |  |                                                                                                                                                                                                                   
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.2   |  | Credit Agreement, effective May 10, 2000, among the Corporation, the
Lenders parties thereto, Salomon Smith Barney Inc., Bank of
Tokyo-Mitsubishi Trust Company, and Citibank, N.A., as agent (SEC File No.
1-82).
|     
|     
|     
|     
|10.13 |  | Advisory Services Agreement, dated as of May 3, 2000, between the
Corporation and Douglas C. Yearley (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.