What: Shares of Freeport-McMoRan (NYSE:FCX) were up by more than 10% by midafternoon on Tuesday. Fueling the soaring stock price was the company's announcement of a plan to cut costs so that it can maximize its cash flow in a weak market.

So what: Freeport-McMoRan actually only announced a plan to make a plan to cut costs. The company is now undertaking a comprehensive review of its operating plans in both its mining and oil and gas operations. It hopes to target cost reductions across the board, including capex, operating, and administrative costs. This could include adjusting mine plans to slow down the development of copper and molybdenum production. Its goal is to have its new plan in place by the time it reports third-quarter results.

While short on detail at the moment, company executives were quoted in the press release as saying that the company is "responding aggressively to current market conditions." Furthermore, they said that the new initiatives will be focused on "maximizing cash flow in a weak commodity environment and on strengthening the company's financial position."

Now what: Announcing a plan to make a plan isn't exactly a compelling reason for the stock to soar more than 10% on the day. So, suffice it to say, it will be interesting to see what the company actually plans on doing. Freeport-McMoRan is already expected to see declining capex and increased cash flow from copper expansion projects coming on line over the next year, while it's planning an IPO of a minority stake in its oil and gas business in order to raise cash to fund development. However, given the recent weakness in commodity prices, the company felt compelled to do more to ensure it is better positioned to weather the downturn. 

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