CLF November 2010 Investor Presentation

OPERATIONAL EXCELLENCE | A WORLD LEADER | STEWARDSHIP

Cliffs Natural Resources Inc.

November 2010


2

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This presentation includes predictive information that is intended to be made as “forward-looking” within the safe harbor protections of the Private Securities Litigation Reform Act of 1995. Although the Company believes that its forward-looking information is based on reasonable assumptions, such information is subject to risks and uncertainties, which could cause materially different results. Important factors that could cause actual results to differ materially from those in the forward-looking information are set forth in the Company’s most recent Annual Report and reports on Form 10-K and 10-Q, and news releases filed with the Securities and Exchange Commission. All reports and news releases are available on Cliffs’ website www.cliffsnaturalresources.com.


Overview of Cliffs Natural Resources Inc.

3

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 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 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 liquidity

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


4

Cliffs Natural Resources Global Footprint

Access to high-growth Asian markets

Pricing correlates to Australian benchmark for lump and fines

Largest iron ore producer in North America

Significant position in North American metallurgical coal

A developing project in a low-cost mining district


Cliffs’ Strategic Imperatives

5

Scale Through

Diversification

GlobalExecution

OperationalExcellence

Building scale through diversification Multiple Revenue Streams

Product Diversification

Geographic Presence

Operational excellence Safety

Technical Competencies

Operating Efficiencies

Global execution Competencies of the Firm

Outlook of Personnel

Global Scalability

Shareholder returns Shareholder Value

Risk Management

“Earning the Right to Grow”

Shareholder Returns


$0

$30

$60

$90

$120

$150

J an 2004 Sep 2004 May 2005 Jan 2006 Sep 2006 May 2007 Jan 2008 Sep 2008 May 2009 Feb 2010

6

Impact of Strategic Execution($ in Millions)

Str

ateg

ic m

iles

ton

esB

usi

nes

s ev

olu

tio

n

Share price performance since January 2004

2005

Acquired 80% of Portman Limited, then the third largest iron ore mining company in Australia

Sales: $1,2032005

Sales: $1,7402006

Sales: $1,922

North American Coal

10%

Other4%

2007

Sales: $2,275

2008

Sales: $3,609

2009

Sales: $2,342

2007

Acquired 30% interest in Amapá iron ore project in Brazil

Acquired 45% economic interest in Sonoma, hard coking and thermal coal mine in Queensland, Australia

Acquired PinnOak, Central Appalachian high-quality, low-volatile met coal mines

2008

Acquired remaining stake in Portman Limited (20%)

Acquired remaining stake in United Taconite (30%)

Acquired stake in Golden West, an Australian iron ore junior mining company

Asia Pacific Iron Ore

24%

North American Iron Ore

62%

2009

$347mm in net proceeds from equity offering executed in May

Added to S&P 500 Index

2004

2010E

Acquired remaining stake (73%) in Wabush Mines

Acquired Freewest Resources and Spider Resources, world-class chromite assets in Ontario, Canada

Acquired INR Energy, high-volatile met coal and thermal coal

2010E

Sales: $4.4B


7

Track record of growth ($mm) Strong balance sheet

Japan 7%

United States45%

China30%

Canada10%

Other 8%

Financial Overview

Diverse end-market exposure (2004 – 2009)

1

Revenue EBITDA

2004 2009

United States76%

Canada19%

China 5% Other 1%

Revenue by end-market


2010 Financial Highlights

8

Record-breaking first-half results:

- Revenues of $1.9 billion, up 124%

- Net income of $354 million, up 830%

- Free cash flow of $173 million, up 178%

$1 billion in acquisitions:

- Wabush remaining stake $88 million

- Freewest acquisition $186 million

- INR Energy’s coal operations $757 million

First-half North American Iron Ore shipments total 11 million tons, up 154%

North American Coal contributes $23 million to second-quarter sales margin

Asia Pacific Iron Ore first-half revenue reaches $469 million, up 95%

The Company achieved investment grade rating from Standard and Poor and Moody’s


Business Segment Overview

9

North American Iron Ore Manage and operate six

North American mines located in Michigan, Minnesota, and Eastern Canada

Annual equity production capacity of 29.5mm tons of iron ore pellets

Over 90% of 2010 volume committed under contract

North American Coal

Own and operate five metallurgical coal mines and one thermal coal mine in West Virginia and Alabama

2011 production capacity in excess of 7mm tons

A significant portion of revenue comprised of exports


Operations include 100%-owned Koolyanobbing complex and 50% equity interest in Cockatoo Island

9mm tonnes of current capacity, with upgrade underway to reach 11mm tonnes by 2012

Direct-shipping lumps and fines ore sold on the seaborne market

North AmericanIron Ore

62%Asia Pacific

Iron Ore23%

North AmericanCoal9%

Other 6%

2009 Revenue

1 Partial year


10

M&A and Development Strategy

Diversify business into other end-markets and other steel-related minerals

Expand geographically into low-political-risk geographies

Objective is to strike a balance among cash-flow positive, profitable, commercial-stage businesses and targets in the early stage of development

NORTH AMERICA

ASIA PACIFIC(AUSTRALIA)

SOUTH AMERICA(BRAZIL)

NORTH AMERICAN MET COAL

SEABORNEIRON ORE

IRON ORE

SEABORNE MET COAL

Cliffs’ strategy: geographic and mineral diversification

Minerals

Geographies

SEABORNEFERROALLOYS


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INR Energy's Coal Operations Acquisition Demonstrates Cliffs’ commitment to further diversify its business into coal

$757 million acquisition funded through available liquidity, including cash on hand and Cliffs’ $600 million credit facility

Transaction will increase Cliffs’ total global coal equity production capacity to nearly 11 million tons by 2012, from today’s current annualized equity production of approximately 7 million tons

Significant metallurgical coal reserves

Expands global reserve base to over 232 million tons

Southern West Virginia multi-mine complex with features that are complementary to our North American Coal operations

Two underground continuous mining operations and one open surface mine

Assets include several metallurgical coal development mines

Increases Cliffs’ products portfolio through the addition of high-volatile metallurgical coal and thermal coal


12

INR Energy's Coal Operations

Southern West Virginia Mining Complex

Metallurgical Coal Operations

Thermal Coal/PCI Operations

Developmental Projects

• Two operating underground mines:

1. Powellton2. Chilton-Dingess

• One operating surface mine:

1. Toney Fork #2

• Two additional underground metallurgical coal mines in active development

• Several additional metallurgical coal mines in permitting phase

Operations located in near proximity to Cliffs

Pinnacle Mine


13

Freewest Resources and Spider Resources Acquisitions position Cliffs to become the leading North American primary chromite and ferrochrome producer and exporter

Customers would include global stainless steel producers

World-class chromite deposits within the “Ring of Fire” in Northern Ontario, Canada– 100% Black Thor– 100% Black Label– 73.5% Big Daddy

Anticipate mining 1 million to 2 million tonnes of high-grade chromite ore to produce 400,000 to 800,000 tonnes of ferrochrome annually with a >30-year mine life

Prefeasibility studies and initial First Nation discussions are underway; production anticipated to commence around 2015

Financed with stock and cash

Ring of Fire – Chromite Project


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Estimated capex of $800mm required to develop the site

Options for financing capex include:– Internal cash flow– Joint-venture partner– Other financial options

Capex will be deployed only after certain project milestones are satisfactorily achieved

Cliffs has the opportunity to evaluate proceeding with the development of the assets over the next 5 years– Majority of capex spending would occur in 2013 and 2014

Ring of Fire – Chromite Project Capex Requirements


15

Ring of Fire – Chromite Project World-Class Assets

CHROMITEDEPOSITS BLACK THOR

BLACK LABEL

BIG DADDY


Industry Overview

16


U.S.Canada

Mexico

Brazil

EU 27CIS

Japan

China

S. Korea

India

Oceania

0

200

400

600

800

1,000

1,200

0 10 20 30 40 50 60

20

09

Kg

/Ca

pita

Ste

el C

on

sum

ptio

n

2009 GDP Per Capita ($US 000s)

Steel Is a Large, Growing, Global Business

BRIC economic growth is substantial and appears inevitable.

In 2009, China’s steel consumption was nine times that of the U.S.

As countries industrialize, per capita steel consumption increases as GDP per capita expands through the maturing process

Note: Size of bubbles represents size of absolute 2008 finished steel consumption in each respective countrySource: Metals Strategies, CIA World Factbook

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18

The Long-Term Outlook Remains Strong

World steel demandWorld steel demand(millions of tonnes)

Source: Metal Strategies

% of crude steel production

Growth in global steel production using blast furnacesGrowth in global steel production using blast furnaces

2010-2015

CAGR 3.4%


2010-2015

CAGR 2.6%

(millions of tonnes)

0

500

1,000

1,500

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009E 2010E 2011E 2012E 2013E 2014E 2015E

0%

25%

50%

75%

100%

400

600

800

1,000

1,200

1,400

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009E 2010E 2011E 2012E 2013E 2014E 2015E



Net imports as a % of

consumption17% 12% 19% 11% 9% 10% 9% 10% 10% 11% 11% 11%

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U.S. steel supply/demand (mm tons)U.S. steel supply/demand (mm tons)

North American Steel Producers Are Particularly Well-Positioned to Participate in an Economic Recovery

’09 – ’15 Consumption CAGR

+5.4% 110

105108 108

101

66

9298

107111 114 116

133

119

135

122

110

65

89

101

113118

123127

2004 2005 2006 2007 2008 2009 2010E 2011E 2012E 2013E 2014E 2015E

Production Consumption



Months supplyTons (mm)

20

Service center inventoriesService center inventories

Steel Center Inventories Remain Low Relative to Historical Levels

1

2

3

4

5

0

2

4

6

8

10

12

14

16

18

2005 2006 2007 2008 2009 2010


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Iron ore– New projects commissioned in countries with medium to high

sovereign risk – 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 regulatory

pressure has emerged

Metallurgical coal– At top of 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.)

Steelmaking Raw Materials Supply-Side Considerations


22

Pricing for Core Products Has Corrected Sharply

Metallurgical coal prices ($/metric ton)

050

100150200250300

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

E

Source: Metal Strategies, equity research, Company estimates

$209 *62%

Iron ore prices ($/metric ton based on 64% iron content)

0255075

100125150175

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

E

Pellets Lumps Fines

$73(48%)$62

(33%)

$85(44%)

Source: Cliffs and various industry publications/reports

$149 75%

$153109%

$129108%

$129(57%)

($ price and % change)

($ price and % change)

* Latest quarterly Settlement


Business Unit Overview

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24

Source: Company data

Cliffs Managed45%

% capacity

U.S. Steel25%

Iron Ore Co. of Canada

16%

Arcelor Mittal14%

Firmly established as a critical supplier to the leading U.S.-based integrated steelmakers

Virtually 100% of sales volume is committed under long-term supply agreements

Formula-based supply agreements capture steel prices, iron ore prices and wholesale inflation while mitigating volatility

Cost effectively increased production base during most recent cycle

Over 900 million tons of proven and probable reserves

North American Leader in Iron OreFinancial overview

Equity production (MM gross tons) North America pellet production


25


The North American Market Is Geographically Protected

ArcelorMittal Mines


Virtually all pellet capacity under long-term contracts

Annual price adjustments are based on a variety of factors including:

— Seaborne pellet prices

— Various PPI indices

— Hot-band steel prices

— Contractual-based price increases, lag-year adjustments and capped pricing

A 48% decrease in pricing in 2009 resulted in average prices for Cliffs decreasing only 11%

2010 guidance: 27 million tons of sales volume, $98 - $103 per ton

— Assumes 96% increase in seaborne pellet prices, $600 - $650 hot band steel

26

North American Iron Ore Pellet Contract Pricing



Overview

Reserves by Mining ComplexCliffs North American Coal Production (millions of tons)

Cliffs will produce primarily high-volatile and low-volatile metallurgical coal, with some thermal coal production

Reserve base of 225 million tons contains some of the highest quality metallurgical coal in the world

NAC capacity will be over 9 million tons in 2012

Coal is sold in both domestic and export markets

Oak Grove19%

INR Met30%

27

Geographic overview

Oak Grove Mine

Pinnacle Complex Pinnacle Mine Green Ridge Mine

North American CoalFinancial overview

1 Partial year

INR Mines: Powellton Mine Chilton-Dingess Mine Toney Fork #2 Mine

225 mm tons

INR Thermal23%

Pinnacle28%

1.74

4+

7+

0

2

4

6

8

10

2009 2010E 2011E


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Business overview Asia Pacific iron ore operations located in Western

Australia:

– Koolyanobbing mine (100% owned)

– Cockatoo Island Joint Venture (50% owned)

Serves the Asian iron ore markets with direct-shipping fines and lump ore, with 2012 capacity to reach 11mtpy

88mm tonnes of proven and probable reserves

Near mine drilling program targeting substantial reserve additions

China85%

Customer overview (2009)

Financial overview

Cockatoo Island

Koolyanobbing

Complex

Japan15%


Geographic overview Production (millions of tonnes)


29

Business overview

45% economic interest, shipments commenced in 2008

2009 equity sales volume: 1.4mm tonnes

21.6 million tonnes of reserves

Mix of metallurgical and thermal coal

Supply agreements in place with JFE, China Steel (metallurgical) and a Korean utility (thermal)

Moves by rail to the Abbot Point Bulk Coal Terminal for export

$142 million investment has returned a total sales margin of $82 million since operations commenced two years ago

Geographic overview

Sonoma

Sonoma Coal



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Business overview 30% owned by Cliffs, 70% owned by Anglo

American

Consists of a significant iron ore deposit, a 192-kilometer railway connecting mine to port, and 71 hectares of real estate for a loading terminal

Majority of production committed under long-term supply agreement with operator of an iron oxide pelletizing plant in Bahrain

$62 million equity loss in 2009 and expectations of profitability in 2010

Geographic overview

Amapá Project

Amapá Project


In Summary

Steel and the raw materials to make it are extremely important

— Building block of society

— Essential to modernization of Brazil, Russia, India and China

Raw materials will continue to be scarce in the long-term

— Very few meaningful iron ore or metallurgical coal projects came online at the top of the last cycle

— Worldwide economic recovery is resulting in increased demand

Cliffs is well positioned in its current markets and to benefit from the current environment

— Active business development targeting program

— Strong balance sheet and significant financial flexibility

31


Cliffs Natural Resources Inc.


Appendix – 2010 Outlook Summary


2010 Outlook Summary

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Sonoma Coal - Equity sales and production of 1.5 million tonnes- 60%/40% thermal-met mix - Average revenue per tonne of $120 - $125- Average cost per tonne of $80 - $85

Amapá Iron Ore Project- Profitable in 2010 for Cliffs’ equity interest

SG&A Expenses and Other Expectations- SG&A expenses of approximately $200 million- Global Exploration costs of $30 million to $35 million - Chromite project costs of approximately $15 million- Full year tax rate approximately 30% - Depreciation and amortization approximately $325 million

Cash from operations- More than $1.3 billion

Capital expenditures- Approximately $275 million

2010 Outlook SummaryNorth American North American Asia Pacific

Iron Ore (1) Coal (2) Iron OreCurrent Previous Current Previous Current PreviousOutlook Outlook Outlook Outlook Outlook Outlook

Sales volume (million tons/tonnes) 27.0 27.0 3.6 3.9 9.0 8.8

Revenue per ton/tonne $98 - $103 $107 - $112 $115 - $120 $115 - $120 $115 - $120 $110 - $115

Cost per ton/tonne $65 - $70 $65 - $70 $120 - $125 $115 - $120 $55 - $60 $55 - $60

(1) Assumes a range of hot band steel pricing of $600 - $650 per ton.(2) North American Coal outlook includes the impact from INR Energy's coal operations.

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CLF November 2010 Investor Presentation

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