Cleveland Cliffs Inc (CLF)

[winchem21]

I don't think the Empire is connected to the refinancing

CLF will reopen Empire as soon as they get a locked-in contract for the ore and pellets. They can pay $200 million a year for three years out of operating cash flow as HBI will be mostly paid off this year. With a 12-13 year life expectancy for Empire, a $40 margin, and ~3.3 Mtons per year, overall net gross would be ~$1.6 billion on a $600 million investment. LG does not want to spend this amount of capital without a guaranteed source of revenue, especially given the other capital allocation alternatives he has. Empire is being pursued to grow overall revenue for the company and keep the BF customers business by replacing ore being diverted to HBI with Empire ore.

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