Post on 08-May-2015
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Cliffs Natural Resources IncCliffs Natural Resources Inc.
2011
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
“Safe Harbor” Statement under the PrivateSafe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This presentation and accompanying oral remarks contain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.These forward-looking statements may be identified by the use of predictive, future-tense or forward-looking terminology, such as “believes,” “anticipates,” “expects,” “estimates,” “intends,”“may,” “will” or similar terms. These statements speak only as of the date of this presentation or the date of the document incorporated by reference, as applicable, and we undertake noongoing obligation, other than that imposed by law, to update these statements. These statements appear in a number of places in this presentation, including the documents incorporated byg g g , p y , p pp p p , g p yreference, and relate to, among other things, the successful completion of the proposed acquisition, our intent, belief or current expectations of our directors or our officers with respect to:our future financial condition, results of operations or prospects; estimates of our economic iron ore and coal reserves; our business and growth strategies; and our financing plans andforecasts. You are cautioned that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and that actual results maydiffer materially from those contained in or implied by the forward looking statements as a result of various factors, some of which are unknown, including, without limitation:• our ability to successfully complete the proposed acquisition;• our ability to successfully integrate Consolidated Thompson’s operations;• our ability to achieve the synergies of the proposed acquisition;• our ability to achieve the strategic and other objectives related to the proposed acquisition;• the impact of the current global economic crisis including downward pressure on prices;• the impact of the current global economic crisis, including downward pressure on prices;• trends affecting our and/or Consolidated Thompson’s financial condition, results of operations or future prospects;• the outcome of any contractual disputes with our customers;• the ability of our customers to meet their obligations to us on a timely basis or at all;• our ability to maintain good relationships with Consolidated Thompson’s customers following consummation of the acquisition;• our actual economic iron ore and coal reserves;• the success of our business and growth strategies;• our ability to successfully identify and consummate any strategic investments;
d h i l• adverse changes in currency values;• the outcome of any contractual disputes with our significant energy, material or service providers;• the success of our cost-savings efforts;• our ability to maintain adequate liquidity and successfully implement our financing plans;• our ability to maintain appropriate relations with unions and employees;• uncertainties associated with unanticipated geological conditions related to underground mining;• problems or uncertainties associated with weather conditions and natural disasters;• the potential existence of significant deficiencies or material weakness in our internal control over financial reporting; and
h k f f d h “ k ” f d f l d h h d h• the risk factors referred to in the “Risk Factors” section of our documents filed with the Securities and Exchange Commission.Reference is made to the detailed explanation of the many factors and risks that may cause such predictive statements to turn out differently, set forth in the Company's Annual Report andReports on Form 10-K, Form 10-Q and previous documents filed with the Securities and Exchange Commission, which are publicly available on Cliffs Natural Resources' website. Theinformation contained in this document speaks as of today and may be superseded by subsequent events.We caution you that the foregoing list of important factors is not exclusive. In addition, in light of these risks and uncertainties, the matters referred to in our forward-looking statements maynot occur. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as may be required by law.The information concerning Consolidated Thompson, including Cliffs’ expectations relating to the impact of the completion of an acquisition of Consolidated Thompson, contained in thisrelease has been taken from or based upon publicly available documents and records filed with the Canadian securities regulatory authorities and other public sources at the time of thisrelease and has not been independently verified by Cliffs. Cliffs assumes no responsibility for the accuracy or completeness of such information, or for any failure by Consolidated Thompson
22
to disclose publicly facts, events or acts that may have occurred or come into existence or that may affect the significance or accuracy of any such information but which are unknown toCliffs. We also strongly urge you to not rely on any single financial measure to evaluate our business.
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Overview of Cliffs Natural Resources IncOverview of Cliffs Natural Resources Inc.
Cliffs Natural Resources (NYSE: CLF) (Paris: CLF) is an international mining and natural resources company A member of the S&P 500 it is the largest producer ofnatural resources company. A member of the S&P 500, it is the largest producer of iron ore pellets in North America, a major supplier of direct-shipping lump and fines iron ore out of Australia and a significant producer of metallurgical coal
Cliffs is executing a strategy designed to increase scale and diversity and focusedCliffs is executing a strategy designed to increase scale and diversity and focused on serving the world’s largest and fastest growing steel markets
The Company boasts a conservatively managed balance sheet with low debt and strong liquidityg q y
With core values of environmental and capital stewardship, our colleagues across the globe endeavor to provide all stakeholders operating and financial transparency as embodied in the Global Reporting Initiative (GRI) framework
3
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Cliffs Natural Resources Global Footprint p
Chromite Project
U.S. Iron Ore
Production Commencing in 2015 Canadian Iron Ore
Production Capacity:5.5Mt
Production Capacity:24.4Mt
U.S. Coal Production Capacity:
Brazilian Iron Ore Production Capacity:
Australian Coal Production Capacity:
1.8Mt
Capacity:9.4Mt
= Iron Ore
= Chromite Deposits
1.5Mt
= Coal
Australian Iron Ore Production Capacity:
9.2Mt
4
Note: The volumes listed above represent Cliffs’ share of production capacity as reported in Form 10-K.
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Cliffs End-Market Exposure EvolutionCliffs End Market Exposure Evolution Strategic steps taken by this management team have resulted in increased customer diversification
As Cliffs continues to grow, end-market exposure remains a primary focus
2005 2010OtherJapan
China13%
Japan7%
Other9%
Japan4%
U.S.57%
U.S.42%Canada
26% China27%
Canada15%
5
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Cliffs Segment Performanceg
North American Iron Ore
Asia Pacific Iron Ore
North American Coal
2010 2009 2010 2009 2010 2009
26.2 16.6 9.3 8.5 3.3 1.9 Sales Tons
2,921$ 1,448$ 1,124$ 542$ 438$ 207$
922$ 276$ 566$ 87$ (29)$ (72)$
Revenues
Sales Margin
104$ 43$ 54$ 96$ 90$ 21$ Capital
Expenditures
6
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Cliffs’ Strategic ImperativesCliffs Strategic Imperatives
Building scale through diversification Global execution
S l Gl b l
Multiple Revenue Streams
Product Diversification
Geographic Presence
Competencies of the Firm
Outlook of Personnel
Global Scalability
Scale Through
Diversification
GlobalExecution
Operational ShareholderOperationalExcellence
Operational excellenceSafety
Shareholder returnsShareholder Value
Shareholder Returns
Technical Competencies
Operating Efficiencies
Risk Management
“Earning the Right to Grow”
7
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Impact of Strategic Execution($ in Millions except per-share amounts)
$140
($ in Millions, except per-share amounts)
tion
Share price performance since January 2005 North American Coal13%
Other 3%
Asia Pacific Iron Ore
North American Iron Ore
61%
$100
$120
ines
s ev
olut Iron Ore
23%
$80
2011E2010
esB
usi
2005
2005Sales: $1,740
2006Sales: $1,922
2007Sales: $2,275
2008Sales: $3,609
2009Sales: $2,342
2007 2008 2009 2010
Sales: $4,682
2011E
Sales: $6.7B 1
$40
$60
gic
mile
ston
e
Acquired 80% of Portman Limited, then the third largest iron ore mining company in Australia
Acquired 30% interest in Amapá iron ore project in Brazil
Acquired 45% economic interest in Sonoma, hard coking and thermal coal mine in
Acquired remaining stake in Portman Limited (20%)
Acquired remaining stake in United Taconite (30%)
A i d t k i G ld
$347mm in net proceeds from equity offering executed in May
Added to S&P 500 Index
Acquired remaining stake (73%) in Wabush Mines
Acquired Freewest Resources and Spider Resources, world-class chromite assets in
Announced acquisition of Consolidated Thompson, an emerging world-class iron ore producer in Eastern Canada
$0
$20
Stra
teg coal mine in
Queensland, Australia
Acquired PinnOak, Central Appalachian high-quality, low-volatile met coal mines
Acquired stake in Golden West, an Australian iron ore junior mining company
chromite assets in Ontario, Canada
Acquired INR Energy, high-volatile met coal and thermal coal
Jan 2005 Sep 2005 May 2006 Jan 2007 Sep 2007 May 2008 Jan 2009 Sep 2009 Jun 2010 Feb 2011
8
1 2011 Estimated sales is calculated based on Cliffs’ 2011 outlook within Cliffs’ 2010 Form 10 -K and excludes the impact from Cliffs’ pending acquisition of Consolidated Thompson Iron Mines Limited.
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Year over Year Highlights – 2006 to 2010g gStrategic Growth
Nearly 100% increase in seaborne iron ore exposure
Financial Nearly 300% in total shareholder return
144% increase in consolidated revenuesCompleted five iron ore acquisitions
Increased exposure to metallurgical coal pointed at Asian and European markets
Burgeoning Chromite project
208% increase in cash from operations
282% increase in net assets
$2,600
Cash from Operations(in millions)
$6.7
Consolidated Revenues(in billions)
27%31%
Debt to Total Capital
$429
$853
$1,320
$1.9 $2.3
$3.6
$2.3
$4.7 23%
17%
$429 $289
$186 0%
9
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Cliff L St di G th St tCliffs Long-Standing Growth Strategy
Cliffs’ strategy: Geographic and mineral diversificationDiversify into other end-markets and Cliffs’ strategy: Geographic and mineral diversification
Minerals Geographies
y
other steel-related minerals
Expand geographically into
l liti l i k hi
NORTH AMERICA
ASIA PACIFIC(AUSTRALIA)
SOUTH AMERICA(BRAZIL)
NORTH AMERICAN
SEABORNEIRON ORE
IRON ORE
SEABORNE MET COAL
low-political-risk geographies
Emphasize cash-flow positive, profitable,
commercial-stage businesses(BRAZIL)MET COAL
SEABORNE FERROALLOYS
Evaluate opportunities in the early stage
of development
1010
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Consolidated ThompsonConsolidated Thompson
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Why Consolidated Thompson?Why Consolidated Thompson?
Strategic Operational Financial
Seaborne iron ore
Strategic relationship with leading global steel producer
High-quality concentrate
Open-pit mining
Meaningful earnings and cash flow potential
Strong growth profile
Builds on platform in Eastern Canada
Proximity to Cliffs’ existing Eastern Canadian operations
g g p
Accretive
Constructive mining jurisdiction
Excellent health, safety and environmental record
Significant and achievable synergy opportunities
12
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Consolidated Thompson OverviewConsolidated Thompson OverviewAn Emerging World-Class Iron Ore Producer
One of the fastest developing iron ore producers in North America with over 580 million metric tons o t e ca t o e 580 o et c to sof reserves
Access to Asia market
Profitable and positive operating cash flow in its second quarter of production
Cliffs’ Wabush mine and facilities1
q p
Excellent infrastructure with power, rail and port access capable of supporting growth profile
Expected to double its annual iron ore capacity to an annualized 16 million metric tons
Attractive development opportunities at Lamêlée and Peppler Lake with approximately 935mt of indicated iron ore resources
Expected to be a low-cost producer
1313
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Diversifying Cliffs’ Product MixDiversifying Cliffs Product Mix(by metric tons)
2009Cliff d t i
2011ECliff d t i
Beyond 2013E1 2 3Cliffs product mix
North American Iron Ore
North AmericanCoal6%
North American Iron Ore
56%A i P ifi
North American Coal12%
Cliffs product mix Cliffs product mix
North American Iron OreAsia Pacific
North American Coal9%
3
62%Asia Pacific Iron Ore
32%
56%Asia Pacific Iron Ore
17%
Iron Ore47%
Asia Pacific Iron Ore
18%
Seaborne Concentrate to Asia
15%
Seaborne Concentrate to Asia
26%26%
1 Based on Cliffs’ 2009 Form 10-K reported tons sold by product segment (all figures converted to metric tons)2 Assumes (a) completion of the acquisition; (b) Cliffs’ 2011 guidance disclosed within its third quarter 2010 Form 10-Q (c) Consolidated Thompson’s June 2010 Feasibility Study3 Ass mes (a) completion of the acq isition (b) Cliffs’ 2011 g idance disclosed ithin its thi d q a te 2010 Fo m 10 Q sed fo 2013 p od ction and (c) completion of Consolidated
1414
3 Assumes (a) completion of the acquisition; (b) Cliffs’ 2011 guidance disclosed within its third quarter 2010 Form 10-Q used for 2013 production and (c) completion of Consolidated Thompson’s expansion projects disclosed in June 2010 Feasibility Study with total capacity reaching 16 million metric tons
Note: Excludes Cliffs’ Asia Pacific Coal and Amapà
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Attractive Commercial Relationships withpLeading Asian Players
Wuhan Iron & Steel (Group) Corporation (“WISCO”)
Consolidated Thompson’s est. production (metric tons mm)
16
China’s 3rd-largest steel producer – produced more than 30mm metric tons of steel in 2009
WISCO affiliate to purchase minimum of 50% of total annual production for first 8 million tons of iron ore produced each year by Consolidated Thompson
8
by Consolidated Thompson
Worldlink Resources (“Worldlink”)
A leading integrated commercial company that imports and exports iron ore, coal, and other bulk solids
A t t h 7 illi t i t f iAgreement to purchase 7 million metric tons of iron ore concentrate per year over a seven-year period
SK Networks (“SKN”)
Subsidiary of SK Group, South Korea’s 3rd-largest conglomerate ti i t di i f ti t h l di t ib ti
2011E Beyond 2013
operating in trading, information technology, energy distribution, and overseas resource development
Agreement to purchase one million metric tons of iron ore concentrate from the Bloom Lake mine
Source: Consolidated Thompson June 2010 Feasibility Study
1515
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Significant Synergy PotentialSignificant Synergy PotentialExpect to realize ~$75mm in pre-tax annual operating synergies
Conveyor, dock and loading
— Leverage Wabush port and loading capacity
— Lower loading costsg
— Increase loading rates and potential annual shipping tonnage
Capture pellet premium margin
— Potential to feed currently idled furnace capacity at Wabush
Parts, supplies and warehouse efficiencies
Technical expertise, management and administrative tasks
1616
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Transaction OverviewTransaction Overview
Cliffs Natural Resources to acquire all of the common shares of Consolidated Thompson Iron Mines Limited.
The total transaction value is approximately C$4.9 billion (including net debt)
Consolidated Thompson’s Board has recommended that its shareholders approve the transaction
Consolidated Thompson’s existing off-take agreement with WISCO is expected to continue with Cliffs
– WISCO will continue to hold a 25% partnership interest in Bloom Lake
Transaction
Under the terms of the transaction, Consolidated Thompson’s shareholders will receive C$17.25 per share, C$4.9 billion in aggregate, consisting of all cash
The transaction represents an implied premium of 30% to Consolidated Thompson’s closing share price as of January 10, 2011.
d f f h h b d b
Consideration
Bridge financing for the transaction has been committed by J.P. Morgan
Cliffs expects to access capital markets to arrange permanent financing
It is Cliffs’ objective to maintain current BBB-/Baa3 ratings
Financing
Significant synergy potential with Cliffs’ Eastern Canadian operations
Financial Impact Transaction is expected to be modestly accretive to earnings and cash flow in 2011 and 2012Financial Impact
The transaction is expected to close in early second quarter, subject to satisfaction or waiver of customary closing conditions Anticipated Closing
1717
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Chromite ProjectChromite Project
18
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Chromite Project OverviewCliffs acquired 100% of Freewest Resources and Spider Resources in 2010 with stock and cash to position the Company to become the leading North American primary chromite
Chromite Project Overview
and ferrochrome producer and exporter
Three world-class chromite deposits located in Northern Ontario, Canada– 100% Black Thor
100% Black Label– 100% Black Label– 73.5% Big Daddy
Anticipate mining 1 million to 2 million metric tons of high-grade chromite ore to produce 600,000 metric tons of ferrochrome annually with a >30-year mine life, y y
Customers would include global stainless steel producers
Prefeasibility studies and First Nation discussions are underway; production anticipated to commence 2015
19
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Chromite Project Benefits CanadaChromite Project Benefits Canada
Project is expected to have substantial benefits in the Far North, northern Ontario and the province, as a whole
Anticipated direct benefits include employment and Project spending during p g gconstruction and operations period
Estimated employment p yis 900 to 1300 jobs
20
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Project will Consist of Four Interrelated ComponentsProject will Consist of Four Interrelated Components
A mine to extract the chromite oreAn ore processing facility to produce concentrate for further refiningAn ore processing facility to produce concentrate for further refiningAn integrated transportation system to link all project componentsA ferrochrome production facility to manufacture the ferrochrome productferrochrome product
21
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
The Project’s Environmental AssessmentThe Project s Environmental AssessmentResearch and field investigations of existing environmental baseline conditions underwayCliffs will conduct a thorough environmental assessment (EA)Submitting the draft Project Description is first step in EA processPermits needed for construction and operation may be issued by
l i l f h EA i f ll l dgovernmental agencies only after the EA is successfully completed
22
1The graphic included on this slide assumes, among other things, favorable results of pre-feasibility and any feasibility studies, cooperation of project stakeholders, and timely EA review and permitting processes.
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Industry OverviewIndustry Overview
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Steel Is a Large Growing Global Business
1,200
Steel Is a Large, Growing, Global BusinessIn 2009, China’s steel consumption was nine times that of the U.S.
S. Korea
800
1,000
onsu
mpt
ion
As countries industrialize, per capita steel consumption increases as GDP per capita expands through h i
JapanChina
Oceania400
600
Kg/
Cap
ita S
teel
Co the maturing process
U.S.Canada
MexicoBrazil
EU 27CISIndia
0
200
2009
0 10 20 30 40 50 602009 GDP Per Capita ($US 000s)
BRIC economic growth is substantial and appears inevitable.
Note: Size of bubbles represents size of absolute 2009 finished steel consumption in each respective countrySource: Metals Strategies, CIA World Factbook
24
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
The Long Term Outlook Remains StrongThe Long-Term Outlook Remains StrongWorld steel demandWorld steel demand(millions of metric tons)
500
1,000
1,500
Source: Metal Strategies
02000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010E 2011E 2012E 2013E 2014E 2015E
% of crude steel production
Growth in global steel production using blast furnacesGrowth in global steel production using blast furnaces(millions of metric tons )
75%
100%
1,200
1,400
0%
25%
50%
75%
400
600
800
1,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010E 2011E 2012E 2013E 2014E 2015E
25
Source: Metal Strategies
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Steelmaking Raw Materials Supply-Side ConsiderationsIron ore– New projects commissioned in countries with medium to high sovereign risk
Hi h d f t i i i ifi t it l d l t
Steelmaking Raw Materials Supply-Side Considerations
– High-end of cost curve requiring significant capital deployment– Suppliers farther inland from deep-water ports, economic logistics– Further tightening of Indian supply as increased export restrictions
have emerged
Metallurgical coal– At top of the last cycle in 2008, Appalachian supplies declined
(mines deeper, seams thinner)– Environmental and safety regulations make permitting more difficult to secure– Other global metallurgical coal basins in challenging political geographies
(Mongolia, Mozambique, etc.)
26
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Pricing for Core Products Has Corrected Sharplyg p yIron ore prices ($/metric ton based on 64% iron content)
$200 2
$203 135%
($ price and % change)
200250 Pellets Lumps Fines
$20023%
$180 323%
050100150200
0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 E
Metallurgical coal prices ($/metric ton)
Source: Cliffs and various industry publications/reports
($ i d % h )
1990
199
199 2
1993
1994
1995
1996
1997
1998
1999
2000
200
200 2
2003
2004
2005
2006
2007
2008
2009
2010
2011
100150200250300350 $330 4
59%
($ price and % change)
050
100
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011E
Source: Metal Strategies, equity research, Platts Index and Company estimates. 1 2011 Pellet pricing: Assumes an increase of 35% over 2010 pellet pricing of approximately $150 per ton
27
1 2011 Pellet pricing: Assumes an increase of 35% over 2010 pellet pricing of approximately $150 per ton. 2 2011 Lump pricing: Assumes a $20 per ton premium to the Platts Index (62% Fe C.I.F. China) year to date average as of May 4, 2011. 3 2011 Fines pricing: Platts Index (62% Fe C.I.F. China) year to date average as of May 4, 2011.4 2011 Metallurgical coal pricing: Assumes BHP’s second quarter 2011 settlement.
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
Appendix – 2011 OutlookAppendix 2011 Outlook
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
2011 Outlook2011 Outlook
Current Previous Current Previous Current PreviousO tl k O tl k O tl k O tl k O tl k O tl k
2011 Outlook SummaryAsia PacificIron Ore (3)
North AmericanIron Ore (1)
North AmericanCoal (2)
Outlook Outlook Outlook Outlook Outlook OutlookSales volume (in millions) 29 28 N/A (4) 6.5 9 9
Revenue per ton $140 - $145 $140 - $145 N/A (4) $135 - $140 $165 - $170 $175 - $180
Cost per ton $65 - $70 $65 - $70 N/A (4) $105 - $110 $70 - $75 $70 - $75
DD&A per ton $5 $5 N/A (4) $15 $11 $12
(1) North American Iron Ore tons are reported in long tons.(2) North American Coal tons are reported in short tons F.O.B. the mine.(3) Asia Pacific Iron Ore tons are reported in metric tons F.O.B. the port.
SG&A Expenses and Other Expectations- SG&A: Approximately $200 million
(4) Due to the severe weather and tornado experienced at Cliffs' Oak Grove Mine in Alabama, the Company is reviewing its previous outlook. Upon completion of the damage assessment, Cliffs will provide an updated outlook for this business segment as appropriate and available.
Cash from operations- Approximately $2.6 billion
- Global Exploration Group: Approximately $50 million to $55 million- Chromite project: Approximately $40 million- Sonoma Coal partner profit sharing: Approximately $10 million- Full year tax rate: Approximately 27%- Depreciation and amortization: Approximately $360 million
pp y $
Capital expenditures- Approximately $700 million, comprised of $300 million in sustainingcapital and $400 million in growth and expansion
29
OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP
2011 Outlook Growth Projects2011 Outlook – Growth Projects
Iron Ore
— $125 million for extension of Cliffs’ Empire Mine in Michigan to 2014
— $20 million related to increasing production at Wabush to 5.5 million tons by 2013
— $146 million related to infrastructure upgrades at Cliffs’ Koolyanobbing Mine in pg y gWestern Australia
Coal
— $45 million related to bringing Lower War Eagle, a high-volatile metallurgical coal mine in West Virginia, into production
— $16 million related to the mine shaft construction at Cliffs’ Oak Grove Mine in Alabama
— $14 million related to the longwall installation at Cliffs’ Pinnacle Mine in West Virginia
30