Clf ir slide deck may 2011

OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP

Cliffs Natural Resources IncCliffs Natural Resources Inc.

2011


“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

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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.


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


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.


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


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


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


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%



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.


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


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


Consolidated ThompsonConsolidated Thompson


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


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


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 AmericanCoal6%


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%


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


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


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


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


Chromite ProjectChromite Project

18


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


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


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


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.


Industry OverviewIndustry Overview


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


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


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


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.


Appendix – 2011 OutlookAppendix 2011 Outlook


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

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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

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Clf ir slide deck may 2011

Education