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OTHER LIABILITIES, INCLUDING EMPLOYEE BENEFITS (Tables) | 12 Months Ended
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Dec. 31, 2016
Other Liabilities, Including Employee Benefits [Abstract] |
Components of Other Liabilities | The components of other liabilities follow:
| December 31,
| 2016 |  | 2015
Pension, postretirement, postemployment and other employment benefitsa | $ | 1,345 |  |  | $ | 1,260 |
Provision for tax positions | 167 |  |  | 152 |
Legal matters | 77 |  |  | 77 |
Insurance claim reserves | 51 |  |  | 59 |
Accrued oil and gas contract commitments | 43 |  |  | — |
Other | 62 |  |  | 93 |
Total other liabilities | $ | 1,745 |  |  | $ | 1,641 |
a. | Refer to Note 7 for current portion.
Schedule of Accumulated Benefit Obligations in Excess of Fair Value of Plan Assets | FCX uses a measurement date of December 31 for its plans. Information for those plans where the accumulated benefit obligations exceed the fair value of plan assets follows:
| December 31,
| 2016 |  | 2015
Projected benefit obligation | $ | 2,127 |  |  | $ | 2,139 |
Accumulated benefit obligation | 2,014 |  |  | 2,037 |
Fair value of plan assets | 1,312 |  |  | 1,399 |
Schedule of Changes Benefit Obligation, Fair Value of Plan Assets, and Funded Status of Plan | Information on the FCX (including FMC’s plans) and PT-FI plans as of December 31 follows:
| FCX |  | PT-FI
| 2016 |  | 2015 |  | 2016 |  | 2015
Change in benefit obligation: |  |  |  |  |  |  |
Benefit obligation at beginning |  |  |  |  |  |  |
of year | $ | 2,104 |  |  | $ | 2,179 |  |  | $ | 318 |  |  | $ | 318 |
Service cost | 27 |  |  | 36 |  |  | 27 |  |  | 26 |
Interest cost | 93 |  |  | 87 |  |  | 29 |  |  | 23 |
Actuarial losses (gains) | 92 |  |  | (118 | ) |  | 2 |  |  | (7 | )
Foreign exchange (gains) losses | (4 | ) |  | (2 | ) |  | 8 |  |  | (32 | )
Special retirement benefitsa | — |  |  | 22 |  |  | — |  |  | — |
Benefits paid | (177 | ) |  | (100 | ) |  | (10 | ) |  | (10 | )
Benefit obligation at end of year | 2,135 |  |  | 2,104 |  |  | 374 |  |  | 318 |
Change in plan assets: |  |  |  |  |  |  |
Fair value of plan assets at |  |  |  |  |  |  |
beginning of year | 1,379 |  |  | 1,416 |  |  | 204 |  |  | 185 |
Actual return on plan assets | 88 |  |  | (26 | ) |  | 47 |  |  | 6 |
Employer contributionsb | 42 |  |  | 90 |  |  | 38 |  |  | 42 |
Foreign exchange (losses) gains | (3 | ) |  | (1 | ) |  | 5 |  |  | (19 | )
Benefits paid | (177 | ) |  | (100 | ) |  | (10 | ) |  | (10 | )
Fair value of plan assets at end |  |  |  |  |  |  |
of year | 1,329 |  |  | 1,379 |  |  | 284 |  |  | 204 |
Funded status | $ | (806 | ) |  | $ | (725 | ) |  | $ | (90 | ) |  | $ | (114 | )
Accumulated benefit obligation | $ | 2,022 |  |  | $ | 2,001 |  |  | $ | 225 |  |  | $ | 175 |
Weighted-average assumptions |  |  |  |  |  |  |
used to determine benefit obligations: |  |  |  |  |  |  |
Discount rate | 4.40 | % |  | 4.60 | % |  | 8.25 | % |  | 9.00 | %
Rate of compensation increase | 3.25 | % |  | 3.25 | % |  | 8.00 | % |  | 9.40 | %
Balance sheet classification of |  |  |  |  |  |  |
funded status: |  |  |  |  |  |  |
Other assets | $ | 9 |  |  | $ | 8 |  |  | $ | — |  |  | $ | — |
Accounts payable and |  |  |  |  |  |  |
accrued liabilities | (4 | ) |  | (35 | ) |  | — |  |  | — |
Other liabilities | (811 | ) |  | (698 | ) |  | (90 | ) |  | (114 | )
Total | $ | (806 | ) |  | $ | (725 | ) |  | $ | (90 | ) |  | $ | (114 | )
a. | Resulted from the 2015 revised mine operating plans and reductions in the workforce (refer to Note 5 for further discussion).
b. | Employer contributions for 2017 are expected to approximate $140 million for the FCX plans and $32 million for the PT-FI plan (based on a December 31, 2016, exchange rate of 13,369 Indonesian rupiah to one U.S. dollar).
Schedule of Assumptions Used | The weighted-average assumptions used to determine net periodic benefit cost and the components of net periodic benefit cost for FCX’s pension plans for the years ended December 31 follow:
| 2016 |  | 2015 |  | 2014
Weighted-average assumptions: a |  |  |  |  |
Discount rate | 4.60 | % |  | 4.10 | % |  | 5.00 | %
Expected return on plan assets | 7.25 | % |  | 7.25 | % |  | 7.50 | %
Rate of compensation increase | 3.25 | % |  | 3.25 | % |  | 3.75 | %
Service cost | $ | 27 |  |  | $ | 36 |  |  | $ | 30 |
Interest cost | 93 |  |  | 87 |  |  | 92 |
Expected return on plan assets | (96 | ) |  | (102 | ) |  | (98 | )
Amortization of prior service credit | — |  |  | — |  |  | (1 | )
Amortization of net actuarial losses | 42 |  |  | 45 |  |  | 28 |
Special retirement benefits | — |  |  | 22 |  |  | — |
Net periodic benefit cost | $ | 66 |  |  | $ | 88 |  |  | $ | 51 |
a. | The assumptions shown relate only to the FMC plans.
The weighted-average assumptions used to determine net periodic benefit cost and the components of net periodic benefit cost for PT-FI’s pension plan for the years ended December 31 follow:
| 2016 |  | 2015 |  | 2014
Weighted-average assumptions: |  |  |  |  |
Discount rate | 9.00 | % |  | 8.25 | % |  | 9.00 | %
Expected return on plan assets | 7.75 | % |  | 7.75 | % |  | 7.75 | %
Rate of compensation increase | 9.40 | % |  | 9.00 | % |  | 9.00 | %
Service cost | $ | 27 |  |  | $ | 26 |  |  | $ | 22 |
Interest cost | 29 |  |  | 23 |  |  | 23 |
Expected return on plan assets | (17 | ) |  | (14 | ) |  | (10 | )
Amortization of prior service cost | 3 |  |  | 3 |  |  | 3 |
Amortization of net actuarial loss | 5 |  |  | 6 |  |  | 8 |
Net periodic benefit cost | $ | 47 |  |  | $ | 44 |  |  | $ | 46 |
Schedule of Net Periodic Benefit Cost Not yet Recognized | Included in accumulated other comprehensive loss are the following amounts that have not been recognized in net periodic pension cost as of December 31:
| 2016 |  | 2015
| Before Taxes |  | After Taxes and Noncontrolling Interests |  | Before Taxes |  | After Taxes and Noncontrolling Interests
Net actuarial loss | $ | 722 |  |  | $ | 466 |  |  | $ | 697 |  |  | $ | 426 |
Prior service costs | 21 |  |  | 11 |  |  | 23 |  |  | 12 |
| $ | 743 |  |  | $ | 477 |  |  | $ | 720 |  |  | $ | 438 |
Schedule of Allocation of Plan Assets | A summary of the fair value for pension plan assets associated with the FCX plans follows:
| Fair Value at December 31, 2016
| Total |  | NAV |  | Level 1 |  | Level 2 |  | Level 3
Commingled/collective funds: |  |  |  |  |  |  |  |  |
Global equity | $ | 420 |  |  | $ | 420 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Fixed income securities | 129 |  |  | 129 |  |  | — |  |  | — |  |  | — |
Global fixed income securities | 107 |  |  | 107 |  |  | — |  |  | — |  |  | — |
Real estate property | 72 |  |  | 72 |  |  | — |  |  | — |  |  | — |
Emerging markets equity | 66 |  |  | 66 |  |  | — |  |  | — |  |  | — |
U.S. small-cap equity | 60 |  |  | 60 |  |  | — |  |  | — |  |  | — |
International small-cap equity | 51 |  |  | 51 |  |  | — |  |  | — |  |  | — |
U.S. real estate securities | 42 |  |  | 42 |  |  | — |  |  | — |  |  | — |
Short-term investments | 17 |  |  | 17 |  |  | — |  |  | — |  |  | — |
Fixed income: |  |  |  |  |  |  |  |  |
Government bonds | 160 |  |  | — |  |  | — |  |  | 160 |  |  | — |
Corporate bonds | 141 |  |  | — |  |  | — |  |  | 141 |  |  | — |
Private equity investments | 25 |  |  | 25 |  |  | — |  |  | — |  |  | — |
Other investments | 36 |  |  | — |  |  | 1 |  |  | 35 |  |  | — |
Total investments | 1,326 |  |  | $ | 989 |  |  | $ | 1 |  |  | $ | 336 |  |  | $ | — |
Cash and receivables | 4 |  |  |  |  |  |  |  |  |
Payables | (1 | ) |  |  |  |  |  |  |  |
Total pension plan net assets | $ | 1,329 |  |  |  |  |  |  |  |  |
| Fair Value at December 31, 2015
| Total |  | NAV |  | Level 1 |  | Level 2 |  | Level 3
Commingled/collective funds: |  |  |  |  |  |  |  |  |
Global equity | $ | 399 |  |  | $ | 399 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Fixed income securities | 129 |  |  | 129 |  |  | — |  |  | — |  |  | — |
Global fixed income securities | 101 |  |  | 101 |  |  | — |  |  | — |  |  | — |
Real estate property | 66 |  |  | 66 |  |  | — |  |  | — |  |  | — |
Emerging markets equity | 60 |  |  | 60 |  |  | — |  |  | — |  |  | — |
U.S. small-cap equity | 56 |  |  | 56 |  |  | — |  |  | — |  |  | — |
International small-cap equity | 56 |  |  | 56 |  |  | — |  |  | — |  |  | — |
U.S. real estate securities | 55 |  |  | 55 |  |  | — |  |  | — |  |  | — |
Short-term investments | 25 |  |  | 25 |  |  | — |  |  | — |  |  | — |
Fixed income: |  |  |  |  |  |  |  |  |
Government bonds | 215 |  |  | — |  |  | — |  |  | 215 |  |  | — |
Corporate bonds | 145 |  |  | — |  |  | — |  |  | 145 |  |  | — |
Private equity investments | 31 |  |  | 31 |  |  | — |  |  | — |  |  | — |
Other investments | 39 |  |  | — |  |  | 1 |  |  | 38 |  |  | — |
Total investments | 1,377 |  |  | $ | 978 |  |  | $ | 1 |  |  | $ | 398 |  |  | $ | — |
Cash and receivables | 6 |  |  |  |  |  |  |  |  |
Payables | (4 | ) |  |  |  |  |  |  |  |
Total pension plan net assets | $ | 1,379 |  |  |  |  |  |  |  |  |
A summary of the fair value hierarchy for pension plan assets associated with the PT-FI plan follows:
| Fair Value at December 31, 2016
| Total |  | Level 1 |  | Level 2 |  | Level 3
Government bonds | $ | 78 |  |  | $ | 78 |  |  | $ | — |  |  | $ | — |
Common stocks | 72 |  |  | 72 |  |  | — |  |  | — |
Mutual funds | 16 |  |  | 16 |  |  | — |  |  | — |
Total investments | 166 |  |  | $ | 166 |  |  | $ | — |  |  | $ | — |
Cash and receivablesa | 119 |  |  |  |  |  |  |
Payables | (1 | ) |  |  |  |  |  |
Total pension plan net assets | $ | 284 |  |  |  |  |  |  |
| Fair Value at December 31, 2015
| Total |  | Level 1 |  | Level 2 |  | Level 3
Common stocks | $ | 43 |  |  | $ | 43 |  |  | $ | — |  |  | $ | — |
Government bonds | 41 |  |  | 41 |  |  | — |  |  | — |
Mutual funds | 12 |  |  | 12 |  |  | — |  |  | — |
Total investments | 96 |  |  | $ | 96 |  |  | $ | — |  |  | $ | — |
Cash and receivablesa | 108 |  |  |  |  |  |  |
Total pension plan net assets | $ | 204 |  |  |  |  |  |  |
a. | Cash consists primarily of short-term time deposits.
Schedule of Expected Benefit Payments | The expected benefit payments for FCX’s and PT-FI’s pension plans follow:
| FCX |  | PT-FIa
2017 | $ | 109 |  |  | $ | 29 |
2018 | 146 |  |  | 16 |
2019 | 113 |  |  | 30 |
2020 | 115 |  |  | 38 |
2021 | 117 |  |  | 40 |
2022 through 2026 | 623 |  |  | 292 |
a. | Based on a December 31, 2016, exchange rate of 13,369 Indonesian rupiah to one U.S. dollar.

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