<PAGE>
 
                                   FORM 10-Q
                      SECURITIES AND EXCHANGE COMMISSION
                             Washington, DC  20549


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

For Quarter Ended  September 30, 1996    Commission File Number 1-10040
                  --------------------                          -------

                         CYPRUS AMAX MINERALS COMPANY
--------------------------------------------------------------------------------
            (Exact name of registrant as specified in its charter)



    Delaware                                                     36-2684040
--------------------------------------------------------------------------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                            Identification Number)



9100 East Mineral Circle, Englewood, Colorado                         80112
--------------------------------------------------------------------------------
(Address of principal executive offices)                            (Zip Code)


                                (303) 643-5000
--------------------------------------------------------------------------------
             (Registrant's telephone number, including area code)


                                   No Change
--------------------------------------------------------------------------------
                (Former name, address, and former fiscal year,
                         if changed since last report)


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 shares of common stock outstanding as of November 12, 1996, was
93,236,952 shares.



                         This report contains 23 pages.

                                      -1-
<PAGE>
 
                        PART I.   FINANCIAL INFORMATION
                        -------------------------------

ITEM 1.   FINANCIAL STATEMENTS
------------------------------

                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
                      (IN MILLIONS EXCEPT PER SHARE DATA)

<TABLE> 
<CAPTION> 
                                                             (Unaudited)                       (Unaudited)
                                                            Three Months                       Nine Months
                                                         Ended September 30,                Ended September 30,
                                                        -------------------                 -------------------
                                                      1996                1995              1996           1995
                                                     ------              ------            ------         ------
<S>                                               <C>              <C>                   <C>            <C> 
REVENUE                                           $     665        $        786          $  2,090       $   2,468
 
COSTS AND EXPENSES
Cost of Sales                                           505                 487             1,528           1,610
Selling and Administrative Expenses                      31                  42                90             110
Depreciation, Depletion, and Amortization                84                  69               229             224
Write-downs                                               -                 445                 -             445
Exploration Expense                                       9                   8                26              22
                                                  ---------          ----------          --------       ---------
TOTAL COSTS AND EXPENSES                                629               1,051             1,873           2,411
                                                  ---------          ----------          --------       ---------
INCOME/(LOSS) FROM OPERATIONS                            36                (265)              217              57
OTHER INCOME (EXPENSE)
Interest Income                                           7                   7                19              18
Interest Expense                                        (50)                (37)             (137)            (99)
Capitalized Interest                                     23                  11                64              26
Equity Investments and Other                              2                   2                 4               6
                                                  ---------          ----------          --------       ---------
INCOME/(LOSS) BEFORE INCOME TAXES AND
 MINORITY INTEREST                                       18                (282)              167               8
Income Tax (Provision) Benefit                           (4)                 78               (38)             16
Minority Interest                                         -                   1                 -               4
                                                  ---------          ----------          --------       ----------
NET INCOME/(LOSS)                                        14                (203)              129               28
Preferred Stock Dividends                                (5)                 (5)              (14)             (14)
                                                  ---------          ----------          --------       ----------
INCOME/(LOSS) APPLICABLE TO COMMON SHARES         $       9          $     (208)         $    115       $       14
                                                  =========          ==========          ========       ==========
EARNINGS/(LOSS) PER COMMON SHARE
 Primary                                          $     .10        $      (2.23)         $   1.23        $     .15
 Fully Diluted                                    $     .10/(1)/   $      (2.23)/(1)/    $   1.23/(1)/   $     .15/(1)/
 
AVERAGE COMMON SHARES OUTSTANDING
 Primary                                              93.2                92.9              93.2             92.9
 Fully Diluted                                       102.9               102.8             102.9            102.7
</TABLE>

See accompanying notes to financial statements.

/(1)/Fully diluted earnings/(loss) per share were less than 3 percent dilutive.

                                      -2-
<PAGE>
 
                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                       (IN MILLIONS EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                          (Unaudited)
                                                          September 30,         December 31,
          ASSETS                                             1996                  1995   
                                                         -------------         -------------
<S>                                                      <C>                   <C>         
CURRENT ASSETS                                                                       
Cash and Cash Equivalents                                  $    163              $    191
Accounts and Notes Receivable, Net                              316                   320
Inventories                                                     500                   447
Prepaid Expenses                                                128                   119
Deferred Income Taxes                                             -                    13
                                                           --------              --------
     Total Current Assets                                     1,107                 1,090
PROPERTIES - At Cost, Net                                     5,217                 4,601
OTHER ASSETS                                                    506                   505
                                                           --------              --------                              
     Total Assets                                          $  6,830              $  6,196
                                                           ========             =========
          LIABILITIES AND SHAREHOLDERS' EQUITY                                               
CURRENT LIABILITIES                                                                  
Short-Term Debt                                            $    504              $    109
Current Portion of Long-Term Debt                                66                    63
Accounts Payable                                                131                   157
Accrued Payroll and Benefits                                     97                    98
Accrued Royalties and Interest                                   61                    55
Accrued Closure, Reclamation and Environmental                   57                    63
Other Accrued Liabilities                                       115                   115
Taxes Payable, Other Than Income Taxes                           63                    58
Income Taxes Payable                                             52                    61
Dividends Payable                                                19                    19
                                                           --------              --------                              
     Total Current Liabilities                                1,165                   798
                                                           --------              --------                              
NONCURRENT LIABILITIES AND DEFERRED CREDITS                                          
Long-Term Debt                                                1,974                 1,734
Capital Lease Obligations                                       137                   143
Deferred Employee and Retiree Benefits                          414                   412
Deferred Closure, Reclamation, and Environmental                304                   348
Deferred Income Taxes                                            82                    58
Other                                                           152                   170
                                                           --------              --------                              
     Total Noncurrent Liabilities and Deferred Credits        3,063                 2,865
                                                           --------              --------                              
MINORITY INTEREST                                               170                   168
SHAREHOLDERS' EQUITY                                                                 
Preferred Stock, $1 Par Value,                                                       
     20,000,000 Shares Authorized:                                                        
     $4.00 Series A Convertible Stock, $50 Stated Value,                                  
      4,666,667 Authorized, 4,664,318 and 4,664,783 Issued                                
      and Outstanding in 1996 and 1995                            5                     5
     Series A Preferred Stock, 1,500,000 Shares                                           
      Authorized, None Issued or Outstanding                      -                     -
Common Stock, Without Par Value,                                                     
     150,000,000 Shares Authorized,                                                       
     Issued 96,031,111 in 1996 and 96,030,198 in 1995             1                     1
Paid-In Surplus                                               2,952                 2,956
Accumulated Deficit                                            (405)                 (465)
Foreign Currency Translation Adjustment                           4                     2
                                                           --------              --------                              
                                                              2,557                 2,499
Treasury Stock at Cost, 2,810,077 Shares in 1996                                     
 and 3,066,615 Shares in 1995                                   (65)                  (70)
Loan to Savings Plan                                            (60)                  (64)
                                                           --------              --------                              
     Total Shareholders' Equity                               2,432                 2,365
                                                           --------              --------                               
     Total Liabilities and Shareholders' Equity            $  6,830              $  6,196 
                                                           ========              ======== 
</TABLE>

See accompanying notes to financial statements.

                                      -3-
<PAGE>
 
                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (IN MILLIONS)

<TABLE>
<CAPTION>
                                                                         (Unaudited)    
                                                                         Nine Months    
                                                                     Ended September 30,
                                                                    ---------------------
                                                                      1996        1995  
                                                                    ----------  ---------
<S>                                                                 <C>         <C>     
CASH FLOWS FROM OPERATING ACTIVITIES                                                    
Net Income                                                          $     129     $   28
                                                                                        
     Depreciation, Depletion, and Amortization                            229        224
     Write-downs                                                            -        445
     Deferred Income Taxes                                                 40       (110)
     Gain on Sale of Assets                                               (18)       (11)
     Changes in Assets and Liabilities Net of Effects                                   
      from Businesses Acquired/Sold                                      (168)       (71)
     Other                                                                 21         26
                                                                    ---------     -------
NET CASH PROVIDED BY OPERATING ACTIVITIES                                 233        531
                                                                    ---------     -------               
CASH FLOWS FROM INVESTING ACTIVITIES                                               
     Capital Expenditures                                                (710)      (587)
     Payments for Businesses Purchased                                    (70)         -
     Capitalized Interest                                                 (64)       (26)
     Advances to and Investments in Affiliates                            (10)      (154)
     Proceeds from Sale of Assets                                          36         31
     Cash Effect of Consolidating Amax Gold                                 -         37
                                                                    ---------    -------               
NET CASH USED FOR INVESTING ACTIVITIES                                   (818)      (699)
                                                                    ---------    -------               
CASH FLOWS FROM FINANCING ACTIVITIES                                               
     Net Proceeds from Issuance of Long-Term Debt                         285        422
     Net Borrowings on Short-Term Debt                                    531        110
     Payments on Short-Term Debt                                         (134)         -
     Payments on Debt and Other Obligations                               (52)      (269)
     Proceeds from Issuance of Stock for Employee Benefits                  1          3
     Dividends Paid                                                       (69)       (69)
     Dividends to Minority Interests                                       (5)        (5)
                                                                    ---------    -------               
NET CASH PROVIDED BY FINANCING ACTIVITIES                                 557        192
                                                                    ---------    -------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                      (28)        24
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                            191        139
                                                                    ---------    -------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                          $     163    $   163 
                                                                    =========    =======
</TABLE>

See accompanying notes to financial statements.

                                      -4-
<PAGE>
 
                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                         NOTES TO FINANCIAL STATEMENTS

NOTE 1.  BASIS OF PRESENTATION
------------------------------

The accompanying interim unaudited financial statements include all adjustments
which are, in the opinion of management, necessary for a fair presentation.
Results for any interim period are not necessarily indicative of the results
that may be achieved in future periods.  The financial information as of this
interim date should be read in conjunction with the financial statements and
notes thereto contained in Cyprus Amax's Annual Report on Form 10-K for the year
ended December 31, 1995.

NOTE 2.  INVENTORIES
--------------------

Inventories detailed by component are summarized below (in millions):

<TABLE>
<CAPTION>
                                      (Unaudited)
                                     September 30,          December 31,
                                          1996                 1995
                                     --------------         ------------
<S>                                  <C>                    <C>
Component
  In-Process Ores, Concentrates,
   and Other                             $ 238               $  212
  Finished Goods                           170                  156
  Materials and Supplies                    92                   79
                                         ------               ------  
                                         $ 500               $  447
                                         ======               ======  
</TABLE>

NOTE 3.  FAIR VALUE OF FINANCIAL INSTRUMENTS
--------------------------------------------

The estimated fair values for financial instruments under SFAS No. 107,
"Disclosures About Fair Value of Financial Instruments," are made at discrete
points in time based on relevant market information. These estimates involve
uncertainties and cannot be determined with precision. At September 30, 1996,
the net carrying value of financial instruments approximated a $1,549 million
liability, whereas the fair value approximated a $1,496 million liability. The
difference in fair value is primarily due to the volatility in the copper market
and a decrease in copper prices which have increased the value of the copper
price protection programs, offset by lower interest rates as of September 30,
1996, compared to rates on the Company's debt.

NOTE 4.  CONTINGENCIES
----------------------

Cyprus Tohono Mining Company was informed in late 1995 by the office of the
Assistant U.S. Attorney in Tucson, Arizona that an action was being considered
under federal environmental laws against Cyprus Tohono Corporation and certain
of its employees. The facts giving rise to this matter involved a break in the
process line at Tohono occurring in 1992. It is not possible to state with
reasonable certainty at this time what action will be taken by the government.

In April 1994, Cyprus Amax was notified by the Department of Justice ("DOJ")
that the government would seek civil penalties for alleged violations of the
Federal Clean Water Act in the operation of Cyprus Amax's Bagdad, Miami, and
Sierrita mines in Arizona. Consent Decrees have been entered and civil penalties
paid resolving the alleged violations.

Cyprus Miami and other companies, in conjunction with the Arizona Department of
Environmental Quality's Water Quality Assurance Revolving Fund program,
continued remediation and assessment of groundwater quality at Pinal Creek near
Miami, Arizona. The ongoing program, initiated in 1989, has resulted in
continued

                                      -5-
<PAGE>
 
improvement of subsurface water quality in the area. While the adequacy of
current remedial efforts and the allocation of expenditures among responsible
parties will not be known until the assessment phase is completed or beyond, the
1993 completion of risk assessment studies allowed further definition of
probable costs for continued study and ongoing treatment. Cyprus Miami also is a
defendant in a lawsuit brought by certain Miami and Globe area landowners
claiming damages relating to allegedly impaired ground water quality in the
Pinal Creek area. It is not possible at this time to reasonably estimate a loss,
if any, that may result from the lawsuit because of the preliminary nature of
discovery in the case and because of the preliminary status of the related
ongoing remedial assessment. A reasonable estimate of any future material
obligations, if any, is expected to be possible in 1997.

At September 30, 1996, Cyprus Amax had accruals of approximately $361 million
for expected future mine closure, reclamation, and environmental remediation
liabilities. Total reclamation costs for Cyprus Amax at the end of current mine
lives are estimated at about $550 million. Additionally, the cost range of
reasonably possible outcomes for sites where remediation costs are estimable is
from $60 million to $250 million of which approximately $70 million is included
as a component of the above reserve. Work on these sites is expected to be
substantially completed in the next several years, subject to the inherent
delays involved in the process. Remediation costs that could not be reasonably
estimated at September 30, 1996, are not expected to have a material impact on
the financial condition and ongoing operations of the Company.

NOTE 5.  INFORMATION BY INDUSTRY SEGMENT
----------------------------------------

Cyprus Amax operates in three principal industry segments--Copper/Molybdenum,
Coal, and Other--which supply mineral products primarily to the construction,
automobile, steel, and utility industries and gold to banks and other bullion
dealers.  The financial information for these segments is presented below (in
millions):

<TABLE>
<CAPTION>
                                           (Unaudited)                        (Unaudited)
                                          Three Months                       Nine Months
                                           Ended September 30,            Ended September 30,
                                          ---------------------           --------------------
                                            1996        1995               1996        1995
                                           -------   --------             --------    --------  
<S>                                       <C>        <C>                  <C>         <C>
Segment Revenue
   Copper/Molybdenum                      $ 290      $ 403                $  987      $1,346
   Coal                                     324        334                   935         978
   Other                                     51         49                   168         144
                                          ------    -------               -------   --------
                                          $ 665      $ 786                $2,090      $2,468
                                          ======    =======               =======  ========= 
Segment Income/(Loss)
   Copper/Molybdenum                      $  31      $ 166                $  188      $  464
   Coal                                      23       (412)                   66        (343)
   Other                                     (3)        (6)                    4         (22)
                                          -------    ------               ------       ------  
                                          $  51      $(252)               $  258      $   99

Corporate                                   (15)       (13)                  (41)        (42)
Interest, Net                               (20)       (19)                  (54)        (55)
Equity Investments and Other                  2          2                     4           6
                                           ------     -----                ------      ------
   Income/(Loss) Before Income Taxes and
   Minority Interest                         18       (282)                  167           8
Income Tax (Provision)/Benefit               (4)        78                   (38)         16
Minority Interest                             -          1                     -           4
                                           ------    -----                ------      ------
   Net Income/(Loss)                      $  14      $(203)               $  129      $   28
                                           ======    =====                ======      ======
</TABLE> 

                                      -6-
<PAGE>
 
REVIEW BY INDEPENDENT ACCOUNTANTS
---------------------------------

The financial information as of September 30, 1996, and for the three-month and
nine-month periods ended September 30, 1996 and 1995, included in Part I
pursuant to Rule 10-01 of Regulation S-X has been reviewed by Price Waterhouse
LLP, the Company's independent accountants, in accordance with standards
established by the American Institute of Certified Public Accountants.  Price
Waterhouse LLP's report is included as page 8 of this quarterly report.

Price Waterhouse LLP does not carry out any significant or additional audit
tests beyond those which 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.

                                      -7-
<PAGE>
 
                       REPORT OF INDEPENDENT ACCOUNTANTS
                       ---------------------------------

To the Board of Directors and Shareholders of Cyprus Amax Minerals Company

We have reviewed the accompanying consolidated balance sheet of Cyprus Amax
Minerals Company and its subsidiaries as of September 30, 1996, and the related
consolidated statements of operations and of cash flows for the three-month and
nine-month periods ended September 30, 1996 and 1995.  These financial
statements are the responsibility of the Company'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 interim financial information for it to be in
conformity with generally accepted accounting principles.

We previously audited in accordance with generally accepted auditing standards,
the consolidated balance sheet as of December 31, 1995, and the related
consolidated statements of operations, of shareholders' equity, and of cash
flows for the year then ended (not presented herein), and in our report dated
February 14, 1996, we expressed an unqualified opinion on those consolidated
financial statements. In our opinion, the information set forth in the
accompanying consolidated balance sheet information as of December 31, 1995, is
fairly stated in all material respects in relation to the consolidated balance
sheet from which it has been derived.

/s/ Price Waterhouse LLP

Denver, Colorado
November 13, 1996

                                      -8-
<PAGE>
 
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
-------------------------------------------------------------------------
FINANCIAL CONDITION
-------------------

RESULTS OF OPERATIONS
---------------------

CYPRUS AMAX MINERALS COMPANY reported 1996 third quarter consolidated net
earnings of $14 million, or 10 cents per share, on revenue of $665 million,
compared with 1995 earnings for the quarter, excluding write-downs, of $135
million, or $1.41 per share, on revenue of $786 million.  Lower third quarter
1996 earnings largely were attributable to lower copper and molybdenum
realizations, and lower coal results. Including the write-downs, Cyprus Amax
reported a 1995 third quarter loss of $203 million, or $2.23 fully diluted loss
per share.

<TABLE>
<CAPTION>
                                                             Three Months                      Nine Months
SELECTED RESULTS                                          Ended September 30,               Ended September 30,
                                                        ---------------------           -----------------------
(In millions except per share data)                         1996       1995                1996         1995
                                                        ---------   ----------          ---------   -----------
<S>                                                     <C>         <C>                 <C>         <C>
  Revenue                                                   $ 665     $   786           $  2,090    $   2,468
  Net Income/(Loss)                                         $  14     $  (203)          $    129    $      28
  Earnings/(Loss) Per Share                                 $ .10     $ (2.23)          $   1.23    $     .15

NOTE: SUPPLEMENTAL DATA (In millions)
  Write-downs, Net of Tax                                   $   -     $  (338)          $      -    $    (338)
  Net Income Excluding Write-downs                          $  14     $   135           $    129    $     366
  Earnings Per Share Excluding Write-downs                  $ .10     $  1.41           $   1.23    $    3.79
</TABLE>

The 1996 third quarter revenue of $665 million was down $121 million from the
comparable 1995 quarter primarily because of 42 cents per pound lower copper
realizations and $1.86 per pound lower molybdenum realizations.

For the first nine months of 1996, Cyprus Amax earned $129 million, or $1.23 per
share, compared with 1995 earnings for the period of $366 million excluding
write-downs, or $3.79 per share.  Including the write-downs, Cyprus Amax
reported earnings of $28 million, or 15 cents fully diluted earnings per share,
for the first nine months of 1995.

Segment income is earnings before corporate overhead, interest, equity and
other, income taxes, and minority interest.

COPPER/MOLYBDENUM

<TABLE>
<CAPTION>                                                    Three Months                      Nine Months
                                                          Ended September 30,               Ended September 30,
                                                        ----------------------          ---------------------------
SELECTED RESULTS (In millions)                            1996          1995                 1996        1995
                                                        --------      ---------         ----------  ------------
<S>                                                     <C>           <C>               <C>         <C>
   Revenue                                                  $  290    $  403            $   987      $    1,346
   Segment Operating Income                                 $   31    $  166            $   188      $      464
</TABLE>

Copper/Molybdenum earned $31 million during the third quarter compared with
earnings of $166 million in the 1995 period.  Earnings decreased due to lower
copper and molybdenum realizations.  Also, lower molybdenum realizations
increased costs of copper sold by 26 cents per pound through lower molybdenum 
by-product credits.

Third quarter copper realizations averaged 93 cents per pound, 42 cents lower
than the similar quarter of 1995.  Cyprus Amax has price protection programs in
place which will ensure a minimum net average realization on an LME basis of 91
cents per pound on 185 million pounds for the fourth quarter of 1996, and

                                      -9-
<PAGE>
 
96 cents per pound on 550 million pounds for 1997.  Through November 12, 1996,
Cyprus Amax has sold 151 million pounds of 1997 copper price protection
contracts generating $21 million of proceeds, which will increase copper
realizations and income during the periods to which the original contracts were
applicable. Periodically Cyprus Amax may elect to sell or buy copper price
protection contracts to mitigate the risk of metal price declines on a portion
of its future copper sales. Additionally, the price protection program for El
Abra ensures a minimum net average realization on an LME basis of 90 cents in
1997 on approximately 400 million pounds with a cap of $1.25 per pound on
approximately 145 million pounds. Cyprus Amax's share of El Abra is 51 percent.

<TABLE>
<CAPTION>
                                                Three Months               Nine Months     
SELECTED OPERATING DATA                      Ended September 30,        Ended September 30,
                                             -------------------        -------------------
(In millions except as noted)                1996          1995            1996        1995
                                             ------     --------        --------     ------ 
<S>                                          <C>        <C>             <C>          <C>
Produced Copper Sold, Pounds                   195          178             548         537
Copper Production, Pounds                      195          175             552         502
Copper Sales Volume, Pounds                    216          199             650         626
                                         
Average Copper Realization, $/Pound          $ .93        $1.35           $1.06       $1.34
                                         
Cost of Sales, $/Pound                       $ .82        $ .56           $ .80       $ .69
Net Cash Cost, $/Pound                       $ .71        $ .66           $ .71       $ .54
Full Cost, $/Pound                           $ .81        $ .75           $ .80       $ .63
                                                                                     
  Bagdad                                                                             
  ------                                 
  Production - Pounds                           60           52             168         152
  Material Mined - Tons                       18.3         15.1            50.8        46.4
  Ore Mined - Tons                             7.4          7.3            22.9        22.8
  Stripping Ratio                             1.47         1.07            1.22        1.04
  Ore Milled - Tons                            7.4          7.0            22.3        21.6
  Ore Grade - %                                .41          .39             .39         .39
                                                                                     
  Miami                                                                              
  -----                                  
  Production - Pounds                           36           33             105          90
  Material Mined - Tons                       25.0         25.1            76.4        67.3
  Ore Mined - Tons                             8.2          9.0            23.1        24.8
  Stripping Ratio                             2.05         1.77            2.31        1.72
  Ore Grade - %                                .53          .51             .53         .47
                                                                                     
  Sierrita                                                                           
  --------                               
  Production - Pounds                           58           61             172         178
  Material Mined - Tons                       25.5         24.8            74.5        64.9
  Ore Mined - Tons                             9.9         10.8            29.6        30.9
  Stripping Ratio                             1.10         1.28            1.28        1.05
  Ore Milled - Tons                            9.9         10.4            29.8        30.3
  Ore Grade - %                                .30          .32             .30         .32
                                                                                     
  Molybdenum Sales - Pounds                     15           15              47          53
  Molybdenum Production - Pounds                13           17              43          58
  Average Realization - $/Pound               4.97         6.83            5.26        8.00
</TABLE>

                                      -10-
<PAGE>
 
<TABLE> 
<CAPTION> 
SELECTED OPERATING DATA (CONT'D)             Ended September 30,        Ended September 30,
                                             -------------------        -------------------
(In millions except as noted)                1996          1995            1996        1995
                                             ------     --------        --------     ------ 
  <S>                                        <C>        <C>             <C>          <C>
  Henderson
  ---------
  Production - Pounds                          7.3           8.6            22.9       30.8
  Material Mined - Tons                        1.7           1.9             5.1        6.2
  Ore Milled - Tons                            1.7           1.9             5.1        6.2
  Ore Grade - %                                .24           .26             .25        .28
</TABLE>

During the quarter, Cyprus Amax sold 195 million pounds of produced copper,
which is 17 million pounds higher than in the 1995 third quarter.  Cost of sales
increased 26 cents per pound from the 1995 period to 82 cents per pound for the
third quarter of 1996, reflecting lower molybdenum by-product credits.

Third quarter net cash costs, before molybdenum credits, improved seven cents
compared with the 1995 third quarter, because of lower unit costs at Cerro Verde
and Miami.  Reflecting lower molybdenum prices, by-product credits were 12 cents
per pound lower.  Total third quarter net cash costs were 71 cents per pound.

Copper production totalled 195 million pounds for the quarter, 20 million pounds
higher than in 1995 primarily due to a 67 percent increase in Cerro Verde's
production, a 15 percent increase in Bagdad's production and a 10 percent
increase in Miami's production.  The Company expects that 1996 production will
approximate 750 million pounds and, depending on the timing of commercial
production at El Abra, could approach 800 million pounds.

In October 1996, a tunnel structure over the conveyor at El Abra collapsed.
Cyprus Amax has repaired the conveyor system and re-started the conveyor on
November 4, 1996.  This accident is not expected to significantly delay reaching
commercial production levels.

Primary molybdenum operations earned $12 million for the third quarter compared
with $25 million for the 1995 period.  The 1996 third quarter realizations
averaged $4.97 per pound compared with $6.83 per pound during the 1995 quarter.
Production decreased to 13 million pounds from 17 million pounds, while sales of
15 million pounds for the third quarter of 1996 were the same as the 1995 third
quarter.

For the first nine months, Copper/Molybdenum earnings were $188 million compared
with $464 million in 1995.  The lower earnings primarily reflect 28 cents per
pound lower average copper realizations and $2.74 per pound lower molybdenum
realizations.

COAL

<TABLE>
<CAPTION>                                                           
                                                 Three Months         Nine Months   
                                             Ended September 30,   Ended September 30,
                                             -------------------   -------------------
SELECTED RESULTS (In millions)                1996       1995         1996       1995
                                             ------    ---------   --------    -------
<S>                                          <C>       <C>         <C>         <C>
   Revenue                                   $  324    $   334     $    935    $    978
   Segment Operating Income/(Loss)           $   23    $  (412)    $     66    $   (343)
NOTE: SUPPLEMENTAL DATA (In millions)                                           
   Write-downs                               $    -    $  (445)    $      -    $   (445)
   Segment Earnings Excluding Write-downs    $   23    $    33     $     66    $    102
</TABLE>

                                      -11-
<PAGE>
 
Coal reported third quarter earnings of $23 million compared with 1995 third
quarter earnings of $33 million before write-downs.  In the third quarter of
1995, Cyprus Amax recorded a pre-tax charge of $445 million to recognize the
write-down of certain coal assets and provisions for associated liabilities.
Including the write-downs, Coal reported a 1995 third quarter loss of $412
million.  Third quarter earnings reflect the expiration and renegotiation of
significant contracts at year-end 1995 in Kentucky and longwall moves at the
Emerald and Cumberland mines in Pennsylvania.  In addition, in the start-up of a
new panel, Emerald initially experienced difficult longwall conditions that have
now been resolved.  The Wabash mine's comparative third quarter earnings were
lower due to lower selling prices as a result of a renegotiation in 1995.

<TABLE>
<CAPTION>
                                                Three Months           Nine Months
                                             Ended September 30,   Ended September 30,
                                             -------------------   -------------------
SELECTED OPERATING DATA                       1996       1995         1996       1995
                                             ------    ---------   --------    ------- 
<S>                                          <C>       <C>         <C>         <C>
Sales Volume - Millions of Tons
-------------------------------
    Eastern Mines                               7.0         7.8        21.2       22.0
    Western Mines - Powder River Basin          9.2         9.0        26.4       26.5
    Western Mines - Other                       3.6         3.4         8.9        9.5
    Springvale                                   .2           -          .6          -
                                             ------    ---------   --------    ------- 
     Total Sales                               20.0        20.2        57.1       58.0
                                             ------    ---------   --------    ------- 
    Oakbridge Equity Share                      1.6         1.5         4.8        4.5

Average Realization - $/Ton                  $15.57      $16.17      $15.83     $16.35

Domestic Average Contract Price - $/Ton      $14.98      $17.42      $15.21     $17.32
Domestic Average Spot Price - $/Ton          $16.96      $12.94      $17.59     $13.45
Australian Average Contract Price - $/Ton    $30.51      $27.45      $30.23     $25.92
Australian Average Spot Price - $/Ton        $23.35      $25.69      $23.49     $22.02

Average Cost of Sales - $/Ton                $14.79      $14.71      $14.97     $14.82
Average Cash Cost - $/Ton                    $11.99      $12.35      $12.53     $12.30
Average Unit Costs - $/Ton                   $14.56      $14.39      $14.62     $14.51
                                                                           
Clean Production - Millions of Tons                                        
-----------------------------------
   Pennsylvania                                 1.5         2.2         5.9        6.5
   Kentucky                                     1.4         1.5         3.8        4.0
   West Virginia                                2.3         1.6         6.1        4.9
   Midwest                                      1.5         2.0         5.2        6.3
   Wyoming - Powder River                       9.1         9.0        26.3       26.5
   Colorado                                     3.2         1.8         6.2        6.2
   Utah                                          .7          .7         2.2        2.1
   Springvale                                    .3           -          .6          -
                                             ------    ---------   --------    ------- 
      Total Production                         20.0        18.8        56.3       56.5
                                             ======    =========   ========    ======= 

   Oakbridge Equity Share                       1.6         1.7         4.4        4.3
</TABLE>

As previously announced in June 1996, Cyprus Amax reached an agreement in which
Central Illinois Public Service Company (CIPS) would discontinue coal purchases
from the Delta mine in Illinois and pay Cyprus Amax Minerals $70 million under a
restructured agreement.  Cyprus Amax ceased shipping coal from Delta and closed
the mine in August 1996 due to its high cost structure and limited marketing
opportunities. Currently CIPS is proceeding with its petition to change to low
sulfur coal and recover the payment from its ratepayers.  Due to unknown timing
of regulatory approval, the $70 million payment and resulting income effect to
Cyprus Amax may be delayed until early 1997.

                                      -12-
<PAGE>
 
Coal production of 22 million tons in the third quarter was one million tons
higher than in 1995, and sales of 22 million tons were comparable to the third
quarter of 1995.

Cyprus Amax's equity share in Oakbridge's earnings, which is reported in
Interest, Equity, and Other, was $3 million and comparable to the 1995 period.

For the first nine months of 1996, Coal earned $66 million compared with $102
million, excluding write-downs, for the first nine months of 1995. The year-end
1995 contract expiration and renegotiation at Kentucky negatively affected
earnings by $28 million for the first nine months of 1996. In addition to the
above mentioned factors, results for the second quarter of 1996 reflected
operational problems at Emerald and Twentymile, while the first quarter was
affected significantly by adverse weather in the East and Midwest.

OTHER MINERALS

<TABLE> 
<CAPTION> 
                                                Three Months           Nine Months
                                             Ended September 30,   Ended September 30,
                                             -------------------   -------------------
SELECTED RESULTS (In millions)                1996       1995         1996       1995
                                             ------    ---------   --------    ------- 
<S>                                          <C>       <C>         <C>         <C>
 Segment Operating Income                    $   (3)    $    (6)   $      4    $   (22)
                                             =======    =======    ========    =======   

 Lithium                                     $    8     $     8    $     24    $    22
 Amax Gold                                        -          (2)         (3)        (8)
 Businesses Sold/Non-Operating                   (1)         (4)         (5)       (14)
 Exploration Expense                            (10)         (8)        (12)       (22)
                                             ------    ---------   --------    ------- 
 Total                                       $   (3)    $    (6)   $      4    $   (22)
                                             =======    =======    ========    =======   
 
SELECTED OPERATING DATA
 
 Lithium
  Sales Volumes - Millions of Lbs.
   Carbonate Equiv.                            11.4        10.5        33.9       27.7
 Gold (100% basis)                                                           
  Sales Volumes - Thousands of Ounces            57          59         181        180
  Realized Gold Price - $/Ounce                 412         405         412        406
</TABLE>

Other Minerals, which includes Lithium, Amax Gold, Exploration, and Businesses
Sold/Non-Operating, had a combined loss of $3 million compared to a $6 million
loss for the third quarter of 1995. Lithium earned $8 million in both the 1996
and 1995 third quarter while Amax Gold reported break-even earnings for the
third quarter of 1996 compared with a $2 million loss in 1995. Amax Gold's
improvement results from a five percent decrease in unit costs and slightly
higher realizations. Additionally, in October 1996 Amax Gold finalized an
amended agreement to acquire the Kubaka project from Cyprus Amax, subject to
shareholders' approval. Closing is expected to occur late in the fourth quarter
of 1996. Exploration expense of $10 million was $2 million more than the 1995
quarter.
The year-to-date earnings for Other Minerals was $4 million compared with a $22
million loss in the first nine months of 1995 primarily due to lower exploration
expenses of $10 million reflecting the sale of certain exploration properties.
Also contributing to the improvement were the absence of a $4 million settlement
recorded in 1995, lower environmental expenses for a business previously sold,
and improved performance for Amax Gold of $5 million resulting from a decrease
in unit costs and slightly higher realizations. 

CORPORATE expenses for the third quarter of 1996 were $15 million or $2 million
higher than in 1995. For the first nine months of 1996 Corporate expenses were
$41 million, or $1 million lower than the same period in 1995 primarily due to a
decrease in stock appreciation rights.


                                      -13-
<PAGE>
 
INTEREST, EQUITY, AND OTHER expense was $18 million for the 1996 third quarter
compared to expense of $17 million for 1995.  Net interest expense of $20
million for the third quarter of 1996 was $1 million higher than the same period
in 1995 due primarily to higher interest expense of $13 million offset by higher
capitalized interest of $12 million.  Year-to-date interest, equity, and other
expense of $50 million was $1 million higher than in 1995 due primarily to
higher interest income of $1 million during the first nine months of 1996.

LIQUIDITY AND CAPITAL RESOURCES

At September 30, 1996, the Company's long-term debt as a percentage of total
capitalization is 46.5 percent, a ratio of current assets to current liabilities
of .95 to 1.0, and a cash balance of $163 million at September 30.  At December
31, 1995, the ratios were 44.2 percent and 1.4 to 1.0, respectively. Cyprus
Amax's non-cash working capital decreased $322 million from $101 million at
December 31, 1995, to a negative $221 million at September 30, 1996, due
primarily to a $395 million increase in the short-term debt, partially offset by
a $53 million increase in inventories.  The increase in the short-term debt was
attributable to $295 million of borrowings on the line of credit and $109
million of borrowings for Cerro Verde development, partially offset by a $25
million production payment.

The Company's cash balance decreased from $191 million at year-end to $163
million at September 30, due primarily to capital expenditures of $710 million,
payment for businesses purchased of $70 million, and dividends paid of $69
million, partially offset by cash provided by operating activities of $233
million and an increase in net debt of $630 million.

In November 1996, the Company sold $150 million of copper/molybdenum and coal
receivables.

For the first nine months of 1996, capital expenditures, excluding capitalized
interest, were $710 million, of which $405 million were for the five major
development projects.  Copper capital expenditures of $337 million included $122
million for the El Abra project and $111 million for the Cerro Verde project.
Coal capital expenditures of $161 million were primarily for sustaining and
replacement capital and $67 million for the Twentymile East Mine and Willow
Creek projects.  Other Minerals capital expenditures included Amax Gold's
expenditures of $150 million primarily for the Fort Knox and Refugio projects.
Total capital spending for 1996 is projected to be approximately one billion
dollars, with over 47 percent, 20 percent, and 30 percent spent on Copper, Coal,
and Amax Gold, respectively.

For the full year 1996 Cyprus expects to spend approximately $130 million for
reclamation, remediation, and environmental compliance, and shutdown costs.

During the first quarter of 1996, Cyprus Amax entered into an agreement with
Amax Gold to provide certain financing arrangements.  Under the restructured
Fort Knox loan facility, Cyprus Amax has guaranteed $150 million and potential
borrowings under the existing $100 million double-convertible line of credit.
Such guaranty would terminate if and when conditions of economic completion, as
defined in the loan agreement, are satisfied.  Cyprus Amax also made available
to Amax Gold a Demand Loan facility to be used primarily to fund additional
capital costs at Fort Knox and for general corporate purposes.  Cyprus Amax
intends to make additional needed financing available to Amax Gold; however,
Cyprus Amax has no obligation to make any advance under the Demand Loan
Facility.  In return for the increased financial support, Cyprus Amax will
receive certain fees and the interest differential resulting from the reduced
rate negotiated with the Fort Knox lenders, as well as a security interest in
certain Amax Gold assets, including Fort Knox.  All interest, fees and the
repayment of any Demand Loans made to Amax Gold will be payable at the option of
Cyprus Amax either in cash or shares of Amax Gold common stock.  During the
third quarter, Amax Gold borrowed $30 million under this facility increasing the
total borrowing to $75 million.  Through November 13, 1996 Amax Gold borrowed an
additional $30 million.  In November 1996, Cyprus Amax received 2.8 million
shares of Amax Gold as repayment for $15 million of interest owed to Cyprus
Amax through September 30, 1996

                                      -14-
<PAGE>
 
under the demand loan facility and for the Fort Knox guaranty fee.  This 
increased Cyprus Amax's ownership in Amax Gold to 52.5 percent.

During 1996, Cyprus Amax expects to be able to provide sufficient funds for
general corporate purposes, including capital expenditures, acquisitions and
financial restructuring through internally generated funds and existing or new
borrowings.

Cyprus Amax paid a regular quarterly dividend of 20 cents per share on its
Common Stock and $1.00 per preferred share during the quarter.  At September 30,
1996, 93,221,034 shares of the Company's Common Stock were outstanding.

CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995

With the exception of historical matters, the matters discussed in this report
are forward-looking statements that involve risks and uncertainties that could
cause actual results to differ materially from projected results. In addition,
other written or oral statements which constitute forward-looking statements
have been made and may in the future be made by or on behalf of the Company.
Such forward-looking statements include statements regarding expected
commencement dates of mining or metal production operations, projected
quantities of future metal production, and anticipated production rates, costs
and expenditures as well as projected demand or supply for the products the
Company produces, which will affect both sales levels and prices realized by the
Company.  Factors that could cause actual results to differ materially include,
among others:  risks and uncertainties relating to general domestic and
international economic and political conditions, the cyclical and volatile
prices of copper, molybdenum, gold and other minerals, the risks associated with
having or not having price protection programs, the political and economic risks
associated with foreign operations, unanticipated ground and water conditions,
unanticipated grade and geological problems, metallurgical and other processing
problems, availability of materials and equipment, the timing of receipt of
necessary governmental permits, the ability to retain and obtain favorable coal
contracts, the occurrence of unusual weather or operating conditions, force
majeure events, lower than expected ore grades, the failure of equipment or
processes to operate in accordance with specifications or expectations, labor
relations, accidents, delays in anticipated start-up dates, environmental risks,
the results of financing efforts and financial market conditions, and other risk
factors detailed in the Company's Securities and Exchange Commission filings.
Many of such factors are beyond the Company's ability to control or predict.
Readers are cautioned not to put undue reliance on forward-looking statements.
The Company disclaims any intent or obligation to update publicly these forward-
looking statements, whether as a result of new information, future events or
otherwise.

                                      -15-
<PAGE>
 
                          PART II - OTHER INFORMATION
                          ---------------------------


ITEM 1.  LEGAL PROCEEDINGS
--------------------------

See Note 4 to Consolidated Financial Statements.

ITEM 2.  CHANGES IN SECURITIES
------------------------------

Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES
----------------------------------------

Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

Not applicable.

ITEM 5.  OTHER INFORMATION
--------------------------

None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------

(a)  The following Exhibits are being filed as part of this Quarterly Report on
     Form 10-Q:
 
   Exhibit
   Number                          Document
   ------                          --------
 
    (11)       Statement re computation of per share earnings.
       
    (15)       Letter re unaudited interim financial information.
       
    (27)       Financial data schedule.

 
(b)  No Current Report on Form 8-K was filed during the quarter ended September
     30, 1996.

                                      -16-
<PAGE>
 
                                   SIGNATURE
                                   ---------


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


                                                 CYPRUS AMAX MINERALS COMPANY
                                                 ----------------------------
                                                          Registrant



Date:   November 13, 1996                         /s/   John Taraba
      ---------------------                       ------------------------
                                                       Vice President and
                                                           Controller

                                      -17-