Good morning, ladies and gentlemen. My name is Kelly, and I am your conference facilitator today. I would like to welcome everyone to Cliffs Natural Resources 2016 Second Quarter Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. The company reminds you that certain comments made on today's call will include predictive statements that are 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 statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially. Important factors that could cause results to differ materially are set forth in reports on Forms 10-K and 10-Q, and news releases filed with the SEC, which are available on the company website. Today's conference call is also available and being broadcast at cliffsnaturalresources.com. At the conclusion of the call, it will be archived on the website and available for replay. The company will also discuss results, excluding certain special items. Reconciliation for Regulation G purposes can be found in the earnings release, which was published this morning. At this time, I would like to introduce Kelly Tompkins, Executive Vice President and Chief Financial Officer. P. Kelly Tompkins - Chief Financial Officer & Executive Vice President: Thank you, Kelly, and thanks to everyone joining us on this morning's call. I'm joined today by our Chairman, President and CEO, Lourenco Goncalves. Our financial results this quarter were outstanding, yet the most significant events in the second quarter are not part of our financial statements, but instead deal with several positive commercial and competitive developments, which Lourenco cover in his remarks. Second quarter…

Your first question comes from the line of Michael Gambardella of JPMorgan. Your line is open.

Good morning. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Good morning, Mike.

Congratulations on just a wonderful effort over the last two years, you and your team; it's been a spectacular turnaround. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Thank you very much, Mike. I appreciate your kind words and more than everything I appreciate you being the great analyst that you are and not being afraid of putting some kinds of opinion that are not mainstream. And I appreciate the great words. Thanks a lot.

Thank you. Thank you. I have a question with the recent bankruptcy at Essar. How are you working with the government to get your hands on those leases? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: We have a signed commitment with Governor Dayton that we have – we are – as soon as Essar vacates the site, the lease are ours. So that covers 41.6%, so almost 42% of the land that's currently occupied by Essar. So it is a matter of time. It's not a matter of if, it's a matter of when. They are in breach of everything. They are not paying anyone. They don't pay the bus drivers that takes the politicians to visit their site. They don't pay any bills. So, they are really a strange type of people over there. So it took long, longer than it should have taken to kick them out, but anyway, now they did what they normally do. That's their MO, they filed for bankruptcy. They have bankruptcies all over the world. They've filed for more bankruptcies than companies. It's amazing. So, anyway, just to stay on track, so as soon as they vacate, we are in. That's the bottom line. We have a signed document with the Governor. And we have support from Governor Dayton, Senator Amy Klobuchar, Senator Al Franken, Congressman Rick Nolan, one of our best champions, the Chief of Staff of the White House, Denis McDonough. So we have a few people supporting us. It may work. I don't know. It can work.

So without that lease someone, it would be impossible for someone to come in and try to restart the construction effort to build that facility, is that correct without those leases? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Well, I'm going to be the landlord. I will be the leaseholder.

Right. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: So, do you want to ask me, if I will allow anyone else to do something over there? The answer is no.

(35:33) C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Yeah. And on top of that – yeah, on top of that with the lease surrounding, the center lease that's owned by the State of Minnesota on the hands of the other private owners, there's no way that once I have this center, anyone else will have the surroundings. So we're in control. We just need to be patient, and allow the Chapter 11 process to follow through the motions.

One last... C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: That site is ours. It's just a matter of time, Mike.

Got it. One last question, the – your sensitivity to HRC prices and to seaborne pellet prices, is that – does that include the new metal contract going forward? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: I'm sorry, I did not understand the beginning of the question. Can you repeat one more time?

Okay. The new metal contracts that will take place at the end of this year and the beginning of next year, will that change the sensitivities that you have to pellet and steel sheet pricing? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Okay, I understand. Look, the sensitivity tables that we have in our press release and we have in all of the publishing only apply to these two contracts. But these two contracts will be no longer valid coming January 1, 2017. So for next year the sensitivities will be different, because the new contract is different from the two contracts we have now. The table is only valid for the balance of 2016, the table that we've put on the press release. As far as 2017 I'm giving the guidance and I'm normally conservative in our price assumptions as history proves. But based on my conservative assumptions we are highly confident that $500 million of EBITDA in 2017 is a good number.

Okay. All right. Thank you very much. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Thank you, Mike.

Your next question comes from the line of Anthony Young of Macquarie. Your line is open. Anthony Young - Macquarie Capital (USA), Inc.: Good morning, guys. Thanks for taking the questions. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Good morning, Anthony. Anthony Young - Macquarie Capital (USA), Inc.: Good morning. Congratulations on a good quarter. First question, just on Australia, the – you're solidly profitable there, like how long did you guys envision that facility running with iron ore prices in the mid to high $50 range? I mean, is that something that could keep on going for longer than what you previously thought about? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Yeah. If prices stay in this $50, $60 range, we have another four years to five years in Australia. Anthony Young - Macquarie Capital (USA), Inc.: Okay. And I mean, if pricing goes higher, could it run for longer than that or would you have to spend some capital to do some exploration work? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Yes and yes. We can run longer, but we're going to have to spend some capital. So, it all depends on how higher, Anthony. Anthony Young - Macquarie Capital (USA), Inc.: Okay. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: I'm not going to take capital risk over there. However, if price moves higher in a way that we feel is consistent, we may two years down the road consider deploying some capital to open new areas. Anthony Young - Macquarie Capital (USA), Inc.: Okay. And then on the commentary this morning, there was no talk of the DRI facility. Is that – I mean, I assume that's dependent on you guys getting the lease in…

And your next question comes from the line of Matthew Fields from Bank of America. Your line is open.

Hey, Lourenco, congratulations on the quarter and congratulations on the couple of your long-standing predictions coming true. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Thank you so much. Matt, I appreciate the recognition.

If you have lottery numbers I'd love to know. But, your other forecast of $500 million for next year for EBITDA. Can you just talk a little bit about sort of some underlying assumptions about what's going into that whether there's incremental volume from maybe a new customer or two customers, or any kind of pricing just any sort of color behind that $500 million? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Sure. I'll be glad. Start with volume. The volume number that we have baked into our forecast for next year is 19 million long tons in the United States, production and sales because that's pretty much what we're going to have as installed capacity going into 2017 without Empire, and 11.5 million metric tons in Australia because that's pretty much our nameplate capacity out of APIO. So, no big deal on that, so, we are going to be full on both U.S. and Australia. As far as prices, I'm a very conservative person when it comes to forecast. So, I am forecasting iron ore prices next year, IODEX prices, at $60 per ton, six-zero, that's the number that's baked into our forecast to get to the $500 million EBITDA. And by the way that's today's price, that's today's IODEX price and today's Metal Bulletin price as well, Platts price. So we have the Platts and we have the Metal Bulletin price both at $60 as we speak right now, just a coincidence. But that's my forecast for next year. And then you may say, look, but the commodities desk of the big banks they are forecasting that prices will go down to $40 and $30 and stuff like that. Well, I'm expecting them to forecast a fifth quarter for 2016, that's the only chance that…

That's great detail. I appreciate it. And then on your cost side, is it sort of going to be reasonably consistent with 2016? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Look. You know what, I'm going to have Kelly answer the first question. Please go ahead. P. Kelly Tompkins - Chief Financial Officer & Executive Vice President: Yeah, Matt, we would expect to – as we maintain our cost guidance for the balance of this year, would expect next year to be in that same ZIP code of cost and again we expect to have incrementally higher volume next year which will also help, so long story short, consistency on the cost front. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: We are not going to have any – well, Matt, we are not going to have any violent move in our cost, but we are responsible miners. We're not running these mines for next quarter or for next year, we're running these mines for the next 100 years. So every now and then we're going to see a quarter that's going to have a little more cost because we have to move some earth in order to open new mining areas, that's the way the mining business is. There is no such a thing as cash cost per ton Q1 stuff like that. We've got to be responsible holders of the assets of the shareholders, that's what we are here, we work for the shareholders, we work for the long run, we don't work to deliver quarter results. So we're going to act accordingly. But all-in-all you should – in your model, if I were in your shoes, I would plus the number you have right now, you are not going to be too far from the reality.

All right. Thanks. And then just sort of lastly, you've gone after the 2018 notes a few times now, is there any remaining kind of appetite to try to make another run at those or do you think you'll just sort of wait till near to maturity to kind of pay them off? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Look when we announced our intention to raise equity, we put the usual procedures regarding the 2018s and that did not change. We are going to extend the runway by eliminating the 2018s and the 2018s, there's a big component on the 2018s of bonds owned by retail and this guys can't participate in exchange against anything, so my intention is to retire them for cash.

Okay. That's good to hear. Thanks again for all the detail and we appreciate it. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Thanks Matt.

Your next question comes from Evan Kurtz of Morgan Stanley. Your line is open. Evan L. Kurtz - Morgan Stanley & Co. LLC: Hey, good morning, Lourenco. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Good morning, Evan. Evan L. Kurtz - Morgan Stanley & Co. LLC: Congrats, great job handling SR Minnesota and the middle contract credits due. Just wanted to ask a couple questions, maybe get your view on U.S. Steel Canada any thoughts on the outcome of that CCAA case, I know it's something you're following pretty closely? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: No, look, we are working and we know how CCAA process works. We know that any other owner of the assets at the end of the CCAA process different from U.S. Steel will have U.S. Steel Canada as a long-term client because they like our pellets better than the stuff that they were using before, supplied by U.S. Steel. This being said, if U.S. Steel, the one that is the biggest creditor in CCAA, becomes the owner at the end, they will probably go back to the old, same old and they will impose their pellets on U.S. Steel Canada. I feel bad for my good friends at Stelco, the real name of U.S. Steel Canada, but at that point I can't do anything about it other than regret. This being said, we have alternatives to sell pellets to other clients, so for us, it would do not mean much, but for U.S. Steel Canada it will mean having the right pellets or having something else. Evan L. Kurtz - Morgan Stanley & Co. LLC: Are you concerned at all that there might be a scenario where the blast furnaces at those mills are idled? C. Lourenco…

Your next question comes from Jeremy Sussman of Clarkson. Your line is open.

Hey, Lourenco, congratulations and thanks very much for taking my question. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Oh, Jeremy, always a pleasure.

So, at $500 million in EBITDA next year, it seems like you generate a lot of free cash, what would be the first use of proceeds on that front? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: The first use of proceeds will be paying down debt, always, always, always, that's our main goal. Until I see this – look we already paid down close to $1.5 billion in net debt since I came to the company, but until I pay another $1 billion, I will not be ready to talk about other things as far as use of capital. We're going to continue to pay down debt as if there is no tomorrow. We are going to continue to retire debt in this company.

Understood. That's loud and clear. And just more of a, I guess, modeling question, what benchmark hot-rolled is in the second half 2016 assumption to kind of get to the 4.80% full-year figure in the sensitivity table? I mean is it safe to say that low spot hot-rolled prices in the beginning of this year kind of hurts your 2016 realizations, but that should be a tailwind for 2017. Am I thinking about that correctly? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Look, no, you are not correct. Our current contracts by and large they are based on customer full-year average price and includes a lot of things and some sales have lagged pricing. Of course, current hot-rolled prices is not reflected yet, so you can't really tie one to the other the way you want. I would recommend you to stay with the tables that we provide, that would be the best way to replicate what we have in our existing contract sales instruments.

Understood. Thanks very much, and good luck again. C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: Thanks Jeremy.

Your next question comes from Lucas Pipes of FBR & Company. Your line is open. Lucas N. Pipes - FBR Capital Markets & Co.: Hey good morning everybody and not to sound like a broken record, but I would like to add my congratulations for a great job, not just this past quarter, but since you started your tenure. I wanted to follow up a little bit on 2017, tremendous amount of detail and appreciate all of that. In terms of the sensitivity to iron ore prices, maybe to follow up just a little bit on that. When I go back to your initial 2016 guidance, it looked like just about $2 or so in USIO price realization changes for every $10 change in the IODEX. For 2017, what do you think is a good range to be thinking about? C. Lourenco Goncalves - Chairman, President & Chief Executive Officer: We haven't developed the tables yet for 2017. So actually at this point Lucas, I don't even know if we're going to continue to have the same type of table, of course, Paul Finan and Kelly Tompkins will be talking to you guys in getting your feedback on that, each one of the research analysts that cover Cliffs to see if that is helpful or not helpful. Sometimes I feel that the table is not really helpful. You heard the last question from Jeremy Sussman that he was trying to do a different way of concluding the price, so not using the tables. So if the table is not a helpful tool, probably it's better not having the table, but the fact of the matter at this time, we don't have the 2017 tables finalized yet. So I can't tell you that. What I can tell you is that, I…

This concludes today's conference call, you may now disconnect.