SECURITIES AND EXCHANGE COMMISSION
                            Washington, D. C. 20549

                                1997 FORM 10-K/A

                ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1997       Commission file number 1-164


                              ASARCO Incorporated

             (Exact name of registrant as specified in its charter)

         New Jersey                                        13-4924440
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)


                     180 Maiden Lane, New York, N. Y. 10038
              (Address of principal executive offices) (Zip Code)


Registrant's telephone number, including area code       (212) 510-2000


          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                                                 Name of each exchange on
      Title of each class                            which registered
Common Stock, without par value                  New York Stock Exchange

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_____

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

As of February 27, 1998, there were of record 39,642,592 shares of Common Stock,
without par value, outstanding,  and the aggregate market value of the shares of
Common  Stock  (based upon the closing  price of Asarco  Common Stock on the New
York Stock Exchange - Composite  Transactions)  of ASARCO  Incorporated  held by
nonaffiliates was approximately $0.9 billion.

PORTIONS OF THE FOLLOWING DOCUMENTS ARE INCORPORATED BY REFERENCE:

Part III:  Proxy  statement in connection  with the Annual Meeting to be held on
           April 29, 1998. 
Part IV:   Exhibit index is on pages C1 through C4.


<PAGE>



                              ASARCO Incorporated

                                  FORM 10-K/A
                               December 31, 1997


                                     INDEX
<TABLE>
<CAPTION>
                                                                                        Page
                                                                                       Number
<S>                                                                                     <C>
FORM 10-K/A                                                                              i


ITEM 14                                                                                  ii


EXHIBIT INDEX                                                                          C1-C4


FORM 11-K                                                                             C49-C63

</TABLE>


<PAGE>


                      ASARCO Incorporated and Subsidiaries

                                  FORM 10-K/A
                               December 31, 1997



The undersigned  registrant hereby amends the 1997 Annual Report on Form 10-K as
set  forth  in the  pages  attached  hereto  to add the  information,  financial
statements and exhibits  required by Form 11-K filed with respect to the Savings
Plan of ASARCO  Incorporated  and  Participating  Subsidiaries  pursuant to Rule
15d-21.

The following item has been refiled to reflect such amendments:


Item 14.  Exhibits, Financial Statements Schedules and Reports on Form 8-K.

     The Exhibit  Index has been  amended and is refiled  herewith to include as
Exhibit  99 the  report  in 11-K  relating  to the  Savings  Plan  for  Salaried
Employees of ASARCO Incorporated and Participating Subsidiaries,  which is filed
herewith.

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


                                    ASARCO Incorporated


                                    By  /s/  K. R. Morano
                                             K. R. Morano
                                             Executive Vice President and
                                             Chief Financial Officer


Date: June 23, 1998


                                       i



<PAGE>



                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K



                                       ii


<PAGE>



                              ASARCO Incorporated
                                 EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit                                                                                                    Indexed
  No.                                Description                                                           on Page
<S>           <C>                                                                                           <C>
3.            Certificate of Incorporation and By-Laws

              (a)   Certificate of  Incorporation - restated,  filed May 4, 1970
                    (Filed as an Exhibit to the Company's  1980 Annual Report on
                    Form 10-K and incorporated herein by reference)

              (b)   Certificate of Amendment to the Certificate of Incorporation
                    effective  April  23,  1975  (Filed  as an  Exhibit  to  the
                    Company's  1980 Annual Report on Form 10-K and  incorporated
                    herein by reference)

              (c)   Certificate  of Amendment of  Certificate  of  Incorporation
                    executed  April  14,  1981  (Filed  as  an  Exhibit  to  the
                    Post-Effective Amendment No. 8 to Registration Statement No.
                    2-47616,  filed  April 30, 1981 and  incorporated  herein by
                    reference)

              (d)   Certificate   of  Amendment  of  Restated   Certificate   of
                    Incorporation  filed on May 6, 1985  (Filed as an Exhibit to
                    the Company's  Quarterly Report on Form 10-Q for the quarter
                    ended March 31, 1985 and incorporated herein by reference)

              (e)   Certificate  of Amendment of  Certificate  of  Incorporation
                    filed July 21,  1986  (Filed as an Exhibit to the  Company's
                    Quarterly Report on Form 10-Q for the quarter ended June 30,
                    1986 and incorporated herein by reference)

              (f)   Certificate   of  Amendment  of  Restated   Certificate   of
                    Incorporation,  as amended filed April 22, 1987 (Filed as an
                    Exhibit to the Company's 1987 Annual Report on Form 10-K and
                    incorporated herein by reference)

              (g)   Statement  of  Cancellation  filed  July  31,  1987  whereby
                    155,000  shares of Series A Cumulative  Preferred  Stock and
                    862,500 shares of $9.00 Convertible  Exchangeable  Preferred
                    Stock were  canceled  (Filed as an Exhibit to the  Company's
                    1987 Annual Report on Form 10-K and  incorporated  herein by
                    reference)

              (h)   Statement of  Cancellation  filed  November 20, 1987 whereby
                    1,026,900 shares of Series A Cumulative Preferred Stock were
                    canceled  (Filed as an Exhibit to the Company's  1987 Annual
                    Report on Form 10-K and incorporated herein by reference)


</TABLE>

                                       C1


<PAGE>


                               ASARCOIncorporated
                                  EXHIBIT INDEX
 <TABLE>
 <CAPTION>
   Exhibit                    Description                                                       Indexed 
       No.                                                                                     on Page
  <S>               <C>                                                                        <C> 
             (i)    Statement of  Cancellation  filed  December 18, 1987 whereby
                    1,250,000   shares  of  Series  B   Cumulative   Convertible
                    Preferred  Stock were  canceled  (Filed as an Exhibit to the
                    Company's  1987 Annual Report on Form 10-K and  incorporated
                    herein by reference)

              (j)   Statement of Cancellation filed March 3, 1988 whereby 27,000
                    shares of Series A Cumulative  Preferred Stock were canceled
                    (Filed as an Exhibit to the Company's  1987 Annual Report on
                    Form 10-K and incorporated herein by reference)

              (k)   Certificate   of  Amendment  of  Restated   Certificate   of
                    Incorporation, as amended, filed August 7, 1989 (Filed as an
                    Exhibit to the Company's  Quarterly  Report on Form 10-Q for
                    the quarter ended June 30, 1989 and  incorporated  herein by
                    reference)

              (l)   By-Laws  as last  amended  on June  26,  1991  (Filed  as an
                    Exhibit to the Company's 1991 Annual Report on Form 10-K and
                    incorporated herein by reference)

4.            Instruments  defining  the rights of security  holders,  including
              indentures

              (a)   There are currently various separate indentures,  agreements
                    or similar  instruments under which long-term debt of Asarco
                    is currently  outstanding.  The Registrant  hereby agrees to
                    furnish to the  Commission,  upon request,  a copy of any of
                    the  instruments  which  define  the  rights of  holders  of
                    long-term   debt   securities.   None  of  the   outstanding
                    instruments represent long-term debt securities in excess of
                    10% of the total assets of Asarco as of December 31, 1997

              (b)   Form of Rights Agreement dated as of July 26, 1989,  between
                    the Company and First  Chicago Trust Company of New York, as
                    Rights Agent,  defining the rights of  shareholders  under a
                    July 1989 Shareholders' Rights plan and dividend declaration
                    (Filed as an  Exhibit  to the  Company's  report on Form 8-K
                    filed on July 28, 1989 and incorporated herein by reference)

              (c)   Rights  Agreement  Amendment dated as of September 24, 1992,
                    between the Company and The Bank of New York,  as  Successor
                    Rights Agent under the Rights  Agreement listed above 
                    (Filed as an Exhibit to the Company's  1992 Annual Report on
                    Form 10-K and incorporated herein by reference)
                    


</TABLE>

                                       C2


<PAGE>


                              ASARCO Incorporated
                                 EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit                                                                                       Indexed
  No.                                      Description                                        on Page
<S>           <C>                                                                              <C>

              (d)   Second Rights  Agreement  Amendment dated as of February 23,
                    1995, between the Company and The Bank of New York (Filed as
                    an  Exhibit  to the  Company's  report  on Form 8-K filed on
                    February 24, 1995, and incorporated herein by reference)

              (e)   Form of  Rights  Agreement  dated as of  January  28,  1998,
                    between  the  Company  and The Bank of New  York,  as Rights
                    Agent,  defining the rights of shareholders' under a January
                    1998  Stockholders'  Rights  plan and  dividend  declaration
                    (Filed  as an  Exhibit  to the  Company's  Form 8-K filed on
                    March 2, 1998, and incorporated herein by reference)

              (f)   Indenture Agreement dated as of February 1, 1993 between the
                    Company and Bankers Trust Company, as Trustee,  covering the
                    issuance  of debt  securities  registered  by the Company in
                    April 1992,  not to exceed $250 million (Filed as an Exhibit
                    to the  Company's  1992  Annual  Report  on  Form  10-K  and
                    incorporated herein by reference)

              (g)   Indenture  Agreement dated as of October 1, 1994 between the
                    Company and Chemical Bank, as Trustee  covering the issuance
                    of debt  securities  registered  by the  Company  in October
                    1994, not to exceed $300 million (Filed as an Exhibit to the
                    Company's  registration  statement  on  Form  S-3  filed  on
                    October 12, 1994, and incorporated herein by reference)

              Material Contracts

 10.          (a)   Stock  Option Plan as last  amended on November 30, 1994
                    (Filed as an Exhibit to the Company's  1994 Annual Report on
                    Form 10-K and incorporated herein by reference)

              (b)   Form of Amended  Employment  Agreement  dated  February  26,
                    1997,  between the Company and currently 12 of its executive
                    officers,   including  Messrs.   R.  de  J.  Osborne,   F.R.
                    McAllister,  K.R. Morano,  R.M. Novotny and A.B.  Kinsolving
                    (Filed as an Exhibit to the Company's  1996 Annual Report on
                    Form 10-K and incorporated herein by reference)

              (c)   Deferred Fee Plan for Directors,  as amended through January
                    28 1998                                                               C11-C15 

              (d)   Supplemental   Pension   Plan  for   Designated   Mid-Career
                    Officers, as amended through January 28, 1998                         C16-C24

              (e)   Retirement  Plan  for  Non-Employee  Directors,  as  amended
                    through January 28, 1998.  Effective  December 31, 1995, the
                    Company   terminated   the  plan  for   current  and  future
                    directors.                                                            C25-C30
 </TABLE>

                                       C3


<PAGE>


                              ASARCO Incorporated
                                 EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit                                                                                   Indexed
  No.                              Description                                            on Page

<S>           <C>                                                                         <C>

              (f)   Directors'  Stock Award Plan, as amended through January 27,
                    1993  (Filed as an  Exhibit  to the  Company's  1992  Annual
                    Report on Form 10-K and incorporated herein by reference)

              (g)   Stock  Incentive Plan adopted by the Company's  Shareholders
                    on April 25,  1990,  as last  amended on  November  29, 1995
                    (Filed as an Exhibit to the Company's  1995 Annual Report on
                    Form 10-K and incorporated herein by reference)

              (h)   Director's Deferred Payment Plan, as amended through January
                    28, 1998                                                              C31-C37 

              (i)   Incentive  Compensation Plan for Senior Officers,  effective
                    January 1, 1996 (Filed as an Exhibit B to the Company's 1997
                    Proxy  Statement  filed on March 12,  1996 and  incorporated
                    herein by reference)

              (j)   1996 Stock Incentive  Plan,  effective April 24, 1996 (Filed
                    as an Exhibit to the  Company's  Registration  Statement  on
                    Form S-8 filed on December 17, 1996, and incorporated herein
                    by reference)

              (k)   Compensation  Deferral Plan, as amended  through January 28,
                    1998                                                                  C38-C48 

11.           Statement re Computation of Earnings Per Share                                 C5

12.           Statement re Computation of Ratios                                             C6

21.           Subsidiaries of the Registrant                                               C7-C10

23.           Consent of Independent Accountants is included on page
              A75 of this Annual Report on Form 10-K.

99.           Report on Form 11-K  relating  to the  Savings  Plan for  Salaried
              Employees of ASARCO  Incorporated and Participating  Subsidiaries.          C50-C63
                                                                                          

</TABLE>
Copies of exhibits may be acquired upon written request to the Treasurer and the
payment of processing and mailing costs.

                                       C4


<PAGE>



                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                               ------------------


                                   FORM 11-K

                               ------------------


                                 ANNUAL REPORT


                        PURSUANT TO SECTION 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934


                               ------------------


                           Commission File No. 1-164


                               ------------------


                  For the fiscal year ended December 31, 1997



                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries



                              ASARCO Incorporated
                                180 Maiden Lane
                            New York, New York 10038




<PAGE>





                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries


                       Financial Statements and Schedules

                           December 31, 1997 and 1996



<PAGE>



                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries


                                     INDEX


<TABLE>
<CAPTION>
                                                                                                     Page
                                                                                                    Number
<S>                                                                                              <C>
Report of Independent Accountants                                                                     C50

Statement of Net Assets Available for
 Benefits, with Fund Information at December 31, 1997                                                 C51

Statement of Net Assets Available for
 Benefits, with Fund Information at December 31, 1996                                                 C52

Statement of Changes in Net Assets Available
 for Benefits, with Fund Information for the year ended
 December 31, 1997                                                                                    C53

Notes to Financial Statements                                                                       C54-C60

Supplemental Schedules:
  Form 5500 Item 27a*-Schedule of Assets Held
   for Investment Purposes at December 31, 1997                                                       C61

  Form 5500 Line 27d*-Schedule of Reportable
   Transactions for the year ended December 31, 1997                                                  C62

Consent of Independent Accountants                                                                    C63
</TABLE>


   *     Refers to item number in Form 5500 ("Annual  Return/Report  of Employee
         Benefit  Plan")  filed with the  Department  of Labor for the plan year
         ended December 31, 1997.

                                      C49


<PAGE>


                       REPORT OF INDEPENDENT ACCOUNTANTS
                                 -------------


To the Savings Plan Committee of ASARCO Incorporated
and Participating Subsidiaries:


We have audited the accompanying statements of net assets available for benefits
of the Savings Plan of ASARCO  Incorporated and Participating  Subsidiaries (the
"Plan") as of December 31, 1997 and 1996,  and the related  statement of changes
in net assets available for benefits for the year ended December 31, 1997. These
financial  statements  are the  responsibility  of the  Plan's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the net assets available for benefits of the Plan as of
December 31, 1997 and 1996 and the changes in net assets  available for benefits
for the year ended  December  31, 1997 in  conformity  with  generally  accepted
accounting principles.

Our audits  were  performed  for the  purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental  schedules, as listed in
the index on the  preceding  page,  are  presented for the purpose of additional
analysis and are not a required part of the basic  financial  statements but are
supplementary  information  required  by the  Department  of  Labor's  Rules and
Regulations for Reporting and Disclosure  under the Employee  Retirement  Income
Security Act of 1974. The Fund Information in the accompanying statements of net
assets  available  for  benefits  and the  statement  of  changes  in net assets
available for benefits is presented for purposes of additional  analysis  rather
than to present the statements of net assets  available for benefits and changes
in net assets  available for benefits of each fund. The  supplemental  schedules
and Fund  information  are the  responsibility  of the  Plan's  management.  The
supplemental  schedules and Fund Information have been subjected to the auditing
procedures  applied in the audits of the basic financial  statements and, in our
opinion,  are fairly  stated in all  material  respects in relation to the basic
financial statements taken as a whole.


                                                       COOPERS & LYBRAND L.L.P.


New York, New York
June 22, 1998

                                      C50


<PAGE>


       Savings Plan of ASARCO Incorporated and Participating Subsidiaries
     Statement of Net Assets Available for Benefits, with Fund Information
                              at December 31, 1997
                             (dollars in thousands)


                                                                             

<TABLE>
<CAPTION>
                                                                                                         Non-
                                                                                                      Participant
                                                   Participant Directed                                 Directed
                                           Vanguard                                
                Vanguard                   Short                                                     
                 Index          Vanguard   Term                                                        
                 Trust    Asarco Mny Mkt    U.S.               Vanguard Vanguard Vanguard Vanguard        Asarco                 
                 500      Common Rsrv     Treasury   Vanguard  Ind Ext  U.S.     Windsor  Bond            Common   
                 Fund     Stock  Prm        Bond    Wellington Market  Growth    II       Index    Loan   Stock                
                Portfolio Fund Portfolio Portfolio  Fund        Fund   Fund      Fund     Fund     Fund   Fund     Total
               ---------- ---- --------- ---------  -----      ------  -----     ------   -----   -----  ------   ------
<S>            <C>       <C>     <C>          <C>    <C>       <C>      <C>      <C>      <C>      <C>      <C>       <C>
Investments,
   at fair
   value:
 Asarco                                                                                                      
   Common
   Stock
   (cost
   $25,211)              $3,260                                                                           $17,763   $21,023

   Registered
   investment
   companies:
   Vanguard
   Money Market                                                                                      
   Reserves Prime
    Portfolio
   (cost
   approximates
   market)                   29    $17,869                                                                    158     18,056
   Vanguard
   Index Trust                                                                                               
   500
   Portfolio
    (cost
   $22,581)    $39,654                                                                                                 39,654 
   Vanguard
   Short Term                                                                                                    
   U.S.
   Treasury
    Bond
   Portfolio
   (cost
   $7,452)                                   $7,476                                                                     7,476       
   Vanguard                                                                                                     
   Wellington
   Fund (cost
   $9,952)                                           $12,282                                                           12,282
   Vanguard
   Index                                                                                                         
   Extended
   Market Fund
    (cost
   $3,113)                                                      $4,026                                                  4,026
   Vanguard                                                                                                       
   U.S. Growth
   Fund (cost
   $3,971)                                                               $5,399                                         5,399
   Vanguard                                                                                                     
   Windsor II
   Fund (cost
   $10,560)                                                                       $13,870                              13,870
   Vanguard                                                                                                           
   Bond Index
   Fund (cost
   $1,661)                                                                                $1,694                        1,694 
 Loans to                                                                                                        
  Participants                                                                                      $4,765              4,765
                  ------    -----   ------    -----   -------    -----    ------   ------  ------    -----    ------    ------
     Total        39,654    3,289   17,869    7,476    12,282    4,026    5,399   13,870    1,694    4,765    17,921  128,245
   Investments
Contributions
   Receivable:
  Participants       167      22       69       39        90       35       48      101        5                          576
  Company                                                                                                       199       199
Interest                                                                                                               
   receivable                                                                                          31                  31
Loans                
   receivable         52       8       28       16        29        8       16       33        1     (191)  
                  -------  ------  -------   ------    ------   ------   ------   ------   ------  -------     ------   ------    

NET ASSETS 
   AVAILABLE
   FOR PLAN
   BENEFITS      $39,873 $3,319   $17,966   $7,531   $12,401   $4,069   $5,463  $14,004   $1,700   $4,605   $18,120  $129,051
                 ======= ======== =======   ======   =======   ======   ======  =======   ======   ======   =======  ========


</TABLE>



                                                                         
   The accompanying notes are an integral part of these financial statements.

                                      C51


<PAGE>



       Savings Plan of ASARCO Incorporated and Participating Subsidiaries
     Statement of Net Assets Available for Benefits, with Fund Information
                              at December 31, 1996
                             (dollars in thousands)



<TABLE>
<CAPTION>
                                                                                                 Non-
                                                                                               Participant
                                              Participant Directed                             Directed
                                  Vanguard  Vanguard        
                 Vanguard           Money    Short            Vanguard                                   
                 Index      Asarco  Market  Term US           Index  Vanguard Vanguard Vanguard    Asarco      
                 Trust     Common  Reserves Treas.   Vanguard Extended U.S.    Windsor  Bond        Common       
                 500        Stock    Prime   Bond   Wellinton  Market  Growth  II      Index Loan   Stock      
               Portfolio    Fund  Portfolio  Port.     Fund      Fund    Fund  Fund    Fund  Fund   Fund    Total
               ---------    ----- --------- --------- ----     -----    ----   ----    ----  ----   ----    -----
<S>              <C>         <C>    <C>       <C>     <C>        <C>    <C>     <C>     <C>  <C>   <C>      <C>
Investments, at
   fair value:
 Asarco                                                                                             
   Common
   Stock
   (cost
   $23,547)               $3,513                                                                    $18,506   $22,019
 Shares of
   registered
   investment
   companies:
   Vanguard
   Money Market                                                                                           
   Reserves Prime
    Portfolio
   (cost
   approximates
   market)                    17    $18,728                                                             90     18,835
   Vanguard
   Index Trust                                                                                               
   500 Portfolio
    (cost
   $19,143)         $29,014                                                                                    29,014
   Vanguard
   Short Term                                                                                                 
   U.S. Treasury
    Bond
   Portfolio
   (cost $7,819)                             $7,812                                                            7,812 
   Vanguard                                                                                                   
   Wellington
   Fund (cost
   $8,337)                                           $9,855                                                    9,855
   Vanguard
   Index                                                                                                     
   Extended
   Market Fund
    (cost $2,568)                                                $3,077                                        3,077
   Vanguard U.S.                                                                                             
   Growth Fund
   (cost $3,187)                                                         $3,964                                3,964
   Vanguard                                                                                                  
   Windsor II
   Fund (cost
   $7,588)                                                                    $9,329                           9,329
   Vanguard Bond                                                                                               
   Index Fund
   (cost $712)                                                                       $716                        716
Loans to                      
 Participants                                                                               $4,374             4,374              
                    ------- -----    ------   -----  -----      -----  -----   ----   ---    -----   ------   -------              
     Total           29,014 3,530    18,728   7,812   9,855     3,077  3,964  9,329   716    4,374   18,596  108,995
   Investments
Contributions
   Receivable:
  Participants          164    21        71      46      89       34      43     90     4                        562
  Company                                                                                              197       197
Interest                                                                                      29                  29
   receivable
Loans receivable         53     7        25      16      21        8       8     25     1   (164) 
                   -------- ------   ------- -------  ------    ------  ------  ----- ----  -------   -----   -----        

NET ASSETS      
   AVAILABLE FOR
   PLAN BENEFITS   $29,231 $3,558   $18,824  $7,874  $9,965   $3,119  $4,015 $9,444  $721 $4,239   $18,793  $109,783
                   ======= ======   =======  ======  ======   ======  ======  ====== ==== ======   =======  ========


</TABLE>



   The accompanying notes are an integral part of these financial statements.
                                      C52



<PAGE>





       Savings Plan of ASARCO Incorporated and Participating Subsidiaries
Statement of Changes in Net Assets Available for Benefits, with Fund Information
                      for the year ended December 31, 1997
                             (dollars in thousands)



<TABLE>
<CAPTION>
                                            Vanguard
                                 Vanguard   Short            
                 Vanguard        Money      Term                  Vanguard         
                 Index    Asarco Market     U.S.                  Index    Vanguard   Vanguard    Vanguard           
                 Trust    Common Reserves   Treasury    Vanguard  Extended  U.S.      Windsor      Bond 
                 500      Stock  Prime     Bond       Wellington  Market  Growth      II           Index      Loan                 
                Portfolio  Fund  Portfolio Portfolio     Fund     Fund      Fund     Fund         Fund       Fund      Total
ADDITIONS:      ---------  ----  ---------  ---------     -----    ----     ----      ------       ------     -----    ------      
                               
                                                 
<S>              <C>        <C>        <C>        <C>       <C>        <C>      <C>       <C>        <C>       <C>       <C>

Investment
   Income
  Net
     appreciation                               
     (depreciation)
     in the fair
     value of
     investments $8,914    $(2,202)            $29      $1,294     $528     $863      $1,976      $32                  $11,434
  Dividends         826        708    $975     437       1,048      275      207       1,268       64                    5,808
  Interest                                                                                                    $354         354 
                  -----    --------   ------  -----     ------    -----      ----      -----      ----       -----     -------
    Total         9,740     (1,494)    975     466       2,342      803    1,070       3,244       96          354      17,596

Contributions
  Participant     2,249        244     863     514       1,225      500      633       1,243       84                    7,555
  Company                    2,456                                                                                       2,456

Loan Repayments      69        103     365     206         315      104      162         380        9       (2,341)

Transfers from      119        106      49      18          13       32       24          44                    40        445
   other plan
Interfund
  transfers         274       (297)   (369)   (390)       (125)    (217)    (123)        447      800        
                  ------      -----   -----   ----        -----    -----   -----       -----     ---      -------     ------    
   
     TOTAL       13,079      1,118   1,883     814       3,770    1,222    1,766       5,358      989       (1,947)    28,052
                 ------      -----    -----   ----       -----    -----    -----       -----      ---       -------    ------
   ADDITIONS

DEDUCTIONS:
  Benefit         1,785      1,941    2,191     914      1,036      185      173        453         7           88     8,773
   payments
  General and                                                                                                             11
   administrative     1                   4       1          1        4                                                         
   
  Loans             651         89      546     242        297       83      145        345         3       (2,401)   
                 ------     ------     -----   ------     ------    ----    ----       ----       ---       -------    -------   
  TOTAL  
  DEDUCTIONS      2,437      2,030     2,741  1,157      1,334      272      318        798        10       (2,313)    8,784
                 ------     ------     ------  -----      ------    ----    ----       ----        ---       ------    ------
                                        

Net increase 
   (decrease)    10,642      (912)      (858)  (343)     2,436      950    1,448      4,560       979          366     19,268

NET ASSETS
   AVAILABLE
   FOR PLAN
   BENEFITS,
   BEGINNING
   OF YEAR       29,231     22,351     18,824  7,874     9,965    3,119    4,015      9,444       721        4,239    109,783
                 ------     ------     ------   -----    -----    -----    -----      -----       ---        ------   -------
NET ASSETS
   AVAILABLE    
   FOR PLAN
   BENEFITS,
   END OF YEAR  $39,873    $21,439    $17,966  $7,531  $12,401   $4,069   $5,463    $14,004    $1,700       $4,605   $129,051
                =======    =======    =======  ======  =======   ======    =====    =======   ========      ======   ========

</TABLE>


                                      
    The accompanying notes are an integral part of these financial statements.

                                       C53

                                                                              


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                         Notes to Financial Statements

1.       Plan Description

         The following  description  of the Savings Plan of ASARCO  Incorporated
         and  Participating  Subsidiaries  (the  "Plan")  provides  only general
         information.  Reference  should  be made  to the  Plan  document  for a
         complete  description  of  the  Plan  and  Plan  amendments,  including
         eligibility requirements and vesting provisions.

         General:

         Effective  January  1,  1980,   ASARCO   Incorporated  (the  "Company")
         established the Savings Plan of ASARCO  Incorporated and  Participating
         Subsidiaries,   which  has  been  amended   thereafter.   Contributions
         commenced in July 1980. The Plan is a defined  contribution plan and is
         administered by the Company's Savings Plan Committee in accordance with
         authority delegated by the Fiduciary Committee. The Plan is designed to
         provide a method of savings by eligible  employees for their retirement
         and other needs, and to enable them to acquire an ownership interest in
         the Company.

         Contributions:

         Employees are eligible for  participation  in the Plan after completing
         six months of service. Each eligible employee wishing to participate in
         the Plan must elect to authorize pre-tax and/or post-tax  contributions
         by payroll deduction.  Contributions are stated in whole percentages of
         1%  to  12%  of  the  participant's  basic  earnings,   as  defined.  A
         participant  may elect to increase,  decrease or suspend the pre-tax or
         post-tax  contributions on the first day of any calendar  quarter.  The
         Internal  Revenue Code of 1986 (the  "Code"),  as amended,  limited the
         maximum  amount an employee may contribute on a pre-tax basis to $9,500
         in 1997 and 1996.

         Matching  Company  Contribution - The Company matches the first 6% of a
         participant's  monthly  contribution  at the rate of 50%.  The matching
         contribution  may be made in either cash or Asarco  Common Stock and in
         the case of cash, the Plan's trustee,  Vanguard Fiduciary Trust Company
         ("Vanguard"),  is required to purchase  Asarco  Common  Stock.  Company
         contributions  for the year ended  December  31, 1997  consisted of the
         following:

<TABLE>
<CAPTION>
                    <S>                                          <C>
                    Cash                                                $2,242,232
                    Asarco Common Stock                                    213,359
                                                                        $2,455,591

</TABLE>
         The Company is not obligated to make a  contribution  during any period
         in  which  it has  no  accumulated  retained  earnings.  The  Company's
         contributions  are subject to all legal  restrictions  which may apply,
         including  Sections  401 and 415 of the Code,  which  limit the  annual
         contributions to an employee's account.


                                       C54


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                   Notes to Financial Statements - Continued

         Participants  are  100%  vested  in both  their  contributions  and the
         Company's matching contribution and earnings thereon upon participation
         in the Plan.

         Benefit Payments:

         Upon  retirement or  termination  of  employment  (other than by death)
         prior to age 65, a  participant  must  consent  in writing to receive a
         distribution  of account  balances.  If  participants do not consent in
         writing, payment of a distribution is made upon the earlier of death or
         attainment  of age 65.  Participants  who  retire  may elect to receive
         payments in annual cash  installments  over a period of up to 10 years.
         Participants  receiving  lump sum  distributions  may choose to receive
         cash  equal to the  value of their  interest  in all  accounts  or full
         shares of Asarco Common Stock equal to all or part of their interest in
         the Asarco Common Stock Fund plus cash equal to the remaining  value of
         their  interest  in all  Accounts.  In the  event  of  the  death  of a
         participant,  his or her  entire  interest  in the Plan will be paid to
         their designated beneficiary in either a single lump sum or annual cash
         installments not to exceed 10 years.

         Loans:

         The Plan provides for loans to  participants  who have  participated in
         the Plan for at least one year,  subject  to certain  limitations.  The
         maximum  loan allowed to each  participant  is limited to the lesser of
         50% of the  total  value  of the  participant's  accounts,  or  $50,000
         reduced  by  the  outstanding   balance  of  any  plan  loans  to  such
         participant.

         A participant's loan is repayable within five years or immediately upon
         termination of employment.  Interest is currently  accrued at the prime
         rate. Loans are secured by a lien on the participant's  interest in the
         Plan. Loan repayments are made through  payroll  withholdings  from the
         participant's  earnings.  A participant  may pre-pay a loan at any time
         without penalty.


2.  Significant Plan Amendments

         On November 25, 1997, the Plan was amended,  effective January 1, 1998,
         to change the eligibility  waiting period from six months of service to
         the first day of any month following  completion of 30 days of service;
         to permit employees to change  contribution rates on a monthly,  rather
         than  quarterly,  basis;  to allow employees who have reached age 64 to
         transfer  Company matching  contributions  from the Asarco Common Stock
         fund to other  investment  options  under the Plan; to add the Vanguard
         International  Growth Fund as an investment  option;  to permit express
         loans and automated  withdrawals;  and to increase,  in accordance with
         the Taxpayer  Relief Act of 1997,  the account  balance  threshold  for
         automatic cash-outs of terminating  employees from $3,500 to $5,000. In
         addition,  on July 30, 1997, the Plan was amended to recognize  service
         by new hires with  Southern  Peru Copper  Corporation  for  purposes of
         satisfying  eligibility  requirements,  and  to  make  other  technical
         changes to comply with changes in law.


                                       C55


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                   Notes to Financial Statements - Continued

3.  Summary of Significant Accounting Policies

       Valuation of Investments:

       The Plan's  investments  are stated at fair  value.  Units of  registered
       investment  companies are valued at quoted market prices which  represent
       the net asset  value of shares held by the Plan at  year-end.  The Asarco
       Common Stock Fund is valued at its year-end unit closing price (comprised
       of year-end  market price plus  uninvested  cash  position).  Participant
       loans are valued at cost which approximates fair value.


       Basis of Accounting:

       The  financial  statements  of the Plan are  prepared  under the  accrual
       method of accounting.

       Investment Transactions and Investment Income:

       Transactions are accounted for on a trade-date basis. Average cost is the
       basis  used  in  the  determination  of  gains  or  losses  on  sales  of
       securities.  Interest  income is accrued when earned.  Dividend income is
       recorded on the ex-dividend date. Capital gain distributions are included
       in dividend income.

       Net  appreciation   (depreciation)  in  the  fair  value  of  the  Plan's
       investments, as shown in the Statement of Changes in Net Assets Available
       for Benefits, consists of the realized gains or losses and the unrealized
       appreciation (depreciation) on those investments.

       Contributions:

       The  Company's  matching  contributions  are measured by reference to the
       participant contributions and are not discretionary.

       Loans to Participants:

       Loans to  participants  are  presented  in the  Statement  of Net  Assets
       Available for Plan Benefits as Plan assets.

       Benefit Payments:

       Benefit payments are recorded when paid.

       Plan Expenses:

       The Company pays all administrative expenses of the Plan including trust,
       recordkeeping,  consulting,  audit and legal fees,  with the exception of
       loan  administration  fees  which are  charged  to  participants.  Taxes,
       excluding  transfer taxes on shares of Asarco Common Stock distributed to
       participants  or their  beneficiaries,  and  investment  fees  related to
       Vanguard Funds are paid from the net assets of such funds.

                                       C56


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                   Notes to Financial Statements - Continued

       Use of Estimates:

       The  preparation  of financial  statements in conformity  with  generally
       accepted  accounting  principles  requires management to make significant
       estimates and assumptions  that affect the reported amounts of assets and
       liabilities and  disclosures of contingent  assets and liabilities at the
       date of the financial  statements and the reported amounts of revenue and
       expenses  during the reporting  period.  Actual results could differ from
       those estimates.

       Risks and Uncertainties:

       The Plan  provides  for  investment  options  in  various  mutual  funds.
       Investment  securities  are  exposed to various  risks,  such as interest
       rate, market and credit. Due to the level of risk associated with certain
       investment  securities and the level of uncertainty related to changes in
       the value of investment  securities,  it is at least reasonably  possible
       that  changes  in  risks  in  the  near  term  would  materially   affect
       participants'  account balances and the amounts reported in the Statement
       of Net Assets  Available for Benefits and the Statement of Changes in Net
       Assets  Available  for  Benefits.  Participants  are  advised  to  read a
       Vanguard  prospectus  or  the  Plan's  summary  plan  description  before
       investing in any fund.

4.  Investment Funds

       Vanguard is the investment  manager and participant  recordkeeper for all
       investment funds of the Plan.  Vanguard is also the trustee of all of the
       funds.

       Upon enrollment in the Plan throughout 1997,  participants directed their
       elected  contributions  to be  invested  in one or more of the  following
       funds in multiples of 5%:

    o             Vanguard Index Trust 500 Portfolio - A fund invested in all of
                  the stocks  included  in the  Standard & Poor's 500  Composite
                  Index (the "Index") in  approximately  the same proportions as
                  they are  represented  in the Index.  At December 31, 1997 and
                  1996, the number of Plan  participants who held an interest in
                  this fund was 1,413 and 1,382, respectively.

    o             Vanguard  Money  Market  Reserves  Prime  Portfolio  - A  fund
                  invested  in  a  portfolio  of  high   quality   money  market
                  instruments  with  maturities of one year or less. At December
                  31, 1997 and 1996, the number of Plan participants who held an
                  interest in this fund was 1,055 and 1,137, respectively.

    o             Vanguard  Short Term U.S.  Treasury  Bond  Portfolio  - A fund
                  invested primarily in short-term U.S. Treasury securities with
                  an average  maturity of two to three  years.  At December  31,
                  1997 and 1996,  the  number of Plan  participants  who held an
                  interest in this fund was 540 and 615, respectively.

    o             Vanguard Wellington Fund - A fund invested in bonds and common
                  stocks.  The bonds are held for  relative  stability of income
                  and principal,  while the common stocks are held for potential
                  growth of capital and income.  At December  31, 1997 and 1996,
                  the number of Plan  participants  who held an interest in this
                  fund was 903 and 882, respectively.

                                       C57


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                   Notes to Financial Statements - Continued

    o             Vanguard  Index  Extended  Market Fund - A fund which provides
                  investment  results that correspond to the aggregate price and
                  yield  performance  of the Wilshire  4500 Index.  The Wilshire
                  4500  Index   consists  of  over  4,500  U.S.   common  stocks
                  (primarily  medium and small  capitalization  stocks) that are
                  not  included  in the  Standard & Poor's 500  Composite  Stock
                  Price Index. At December 31, 1997 and 1996, the number of Plan
                  participants  who held an  interest  in this  fund was 470 and
                  451, respectively.

    o             Vanguard  U.S.  Growth Fund - A fund  invested  primarily in a
                  diversified  portfolio  of common  stocks  with  above-average
                  growth potential. At December 31, 1997 and 1996, the number of
                  Plan  participants  who held an  interest in this fund was 555
                  and 481, respectively.

    o             Vanguard Windsor II Fund - A fund invested in common stocks to
                  provide capital  appreciation and dividend income. At December
                  31, 1997 and 1996, the number of Plan participants who held an
                  interest in this fund was 1,014 and 946, respectively.

    o             Asarco Common Stock Fund - A fund that invests  exclusively in
                  ASARCO  Incorporated common stock with a small amount invested
                  in the Vanguard Money Market Reserves Prime Portfolio to allow
                  for timely  responsiveness to Plan  transactions.  At December
                  31, 1997 and 1996, the number of Plan participants who held an
                  interest in this fund was 2,105 and 2,091, respectively.

    o             Vanguard Bond Index Fund - A fund that holds a combination  of
                  securities  which,  taken  together,  are  expected to perform
                  similarly  to the Lehman  Brothers  Aggregate  Bond Index.  At
                  December  31, 1997 and 1996,  the number of Plan  participants
                  who  held  an   interest   in  this   fund  was  104  and  74,
                  respectively.


The Plan also maintains the following fund:

    o             Loan Fund - A fund  designed to facilitate  the  recordkeeping
                  and other  administrative  functions relating to loans made to
                  participants  based on their  account  balances  (See Note 1).
                  These loans are recorded as receivables of the Plan.

                                       C58


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                   Notes to Financial Statements - Continued

Vanguard as recordkeeper  maintains  individual  account records reflecting each
participant's  net  interest in each fund of the Plan in which such  participant
invests.  Participant's  net interest in each fund of the Plan is represented by
units of participation. The following schedule shows the number of units and the
net asset value per unit in each fund:

<TABLE>
<CAPTION>
                                                     December 31, 1997                  December 31, 1996
                                                     -----------------                  -----------------
                                                                  Net Asset                          Net Asset
                                                 Number of          Value          Number of           Value
                                                   Units           Per Unit          Units            Per Unit
<S>                                          <C>                <C>             <C>               <C>

Asarco Common Stock Fund*                           2,530,926           $8.38          2,381,684            $9.29

Vanguard Index Trust
 500 Portfolio*                                       440,254          $90.07            419,520           $69.16

Vanguard Money Market Reserves Prime
  Portfolio*                                       17,869,282           $1.00         18,727,988            $1.00

Vanguard Short Term U.S. Treasury Bond
  Portfolio*                                          732,259          $10.21            768,103           $10.17

Vanguard Wellington Fund*                             417,054          $29.45            376,883           $26.14

Vanguard Windsor II Fund*                             484,616          $28.62            391,461           $23.83

Vanguard U.S. Growth Fund                             188,118          $28.70            166,956           $23.74

Vanguard Index Extended
  Market Fund                                         130,939          $30.75            117,469           $26.19

Vanguard Bond Index Fund                              167,917          $10.09             72,760            $9.84
</TABLE>

         *Represents 5% or more of net assets  available for plan benefits as of
          December 31, 1997 and 1996.

                                       C59


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                   Notes to Financial Statements - Continued

5.  Tax Status

       The Plan,  as amended  through  July 27,  1994,  has received a favorable
       determination  from the  Internal  Revenue  Service  ("IRS") that it is a
       qualified  plan and trust  under  Section  401(a) of the Code and,  thus,
       exempt from federal  income taxes under  provisions of Section  501(a) of
       the Code.  The Plan has been amended since  receiving  the  determination
       letter. However, the Plan's management believes that the Plan is designed
       and is  currently  being  operated  in  compliance  with  the  applicable
       requirements of the Code.

6.  Termination Priorities

       Although it has not expressed  any intent to do so, the Company  reserves
       the right to amend or discontinue  the Plan by action of the Board at any
       time. In the event of termination or partial termination of the Plan or a
       complete discontinuance of matching Company contributions under the Plan,
       each affected participant shall be 100% vested in all amounts credited to
       their account at the date of such termination,  partial  termination,  or
       complete discontinuance of matching Company contributions.

7.  Related Party Transactions

       The Plan  invests in shares of mutual  funds  managed by an  affiliate of
       Vanguard.  Vanguard acts as trustee for only those investments as defined
       by   the   Plan.    Transactions   in   such   investments   qualify   as
       party-in-interest  transactions  which  are  exempt  from the  prohibited
       transaction rules.


                                       C60


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                               Form 5500 Item 27a
                Schedule of Assets Held for Investment Purposes
                              at December 31, 1997

<TABLE>
<CAPTION>
                                                                                        Cost or               Market
       Identity of Issue or Borrower                                                  Book Value              Value
     <S>                                                                          <C>                  <C>
       Vanguard Index Trust 500 Portfolio                                               $22,581,381       $39,653,722

       Asarco Common Stock Fund                                                          25,210,969        21,209,158

       Vanguard Money Market Reserves Prime Portfolio                                    17,869,282        17,869,282

       Vanguard Short Term U.S. Treasury Bond Portfolio                                   7,452,128         7,476,363

       Vanguard Wellington Fund                                                           9,951,629        12,282,228

       Vanguard Index Extended Market Fund                                                3,112,679         4,026,362

       Vanguard U.S. Growth Fund                                                          3,970,822         5,398,987

       Vanguard Windsor II Fund                                                          10,560,398        13,869,714

       Vanguard Bond Index Fund                                                           1,660,650         1,694,280

     Loan Fund
       Participants' Loans (interest rates range from 6% to 9%)                           4,764,953         4,764,953
                                                                                                 

       TOTAL INVESTMENTS                                                               $107,134,891      $128,245,049
                                                                                        ============      ============
</TABLE>







                                       C61


<PAGE>


                      Savings Plan of ASARCO Incorporated
                         and Participating Subsidiaries

                               Form 5500 Line 27d
                      Schedule of Reportable Transactions
                      for the year ended December 31, 1997


<TABLE>
<CAPTION>
                                                     Purchase           Selling            Basis of
                  Description of Asset                Price              Price              Asset             Net Gain
         <S>                                     <C>               <C>                <C>                 <C>
         Vanguard Index Trust
          500 Portfolio                          $7,537,075        $5,811,296               $4,158,159    $1,653,137

         Vanguard Money Market
          Reserves Prime Portfolio               8,707,659         9,566,365                 9,566,365       -

         Vanguard Wellington Fund                3,518,644         2,384,779                 1,942,121       442,658

         Vanguard Windsor II                     5,102,417         2,537,450                 2,148,083       389,367

         Asarco Common Stock Fund                6,654,562         5,369,546                 5,001,471       368,075

</TABLE>


                                       C62


<PAGE>




                       CONSENT OF INDEPENDENT ACCOUNTANTS




         We  consent  to the  incorporation  by  reference  in the  Prospectuses
constituting part of the Registration  Statements of ASARCO Incorporated on Form
S-3 (File Nos.  33-45631,  33-55993  and  333-02359)  and on Form S-8 (File Nos.
2-67732, 2-83782,  33-34606,  333-16875,  333-18083 and 333-46181) of our report
dated June 22, 1998 on our audits of the Statements of Net Assets  Available for
Benefits  of  the  Savings  Plan  of  ASARCO   Incorporated  and   Participating
Subsidiaries as of December 31, 1997 and 1996, the Supplemental  Schedules as of
December  31, 1997,and for the year then ended and the  Statement  of Changes in
Net Assets  Available for Benefits for the year ended  December 31, 1997,  which
report is included in this Annual Report on Form 11-K.


                                                       COOPERS & LYBRAND L.L.P.




New York, New York
June 22, 1998

                                       C63