Mesabi Trust Press Release - Seite 2

With respect to calendar year 2022, Northshore has not advised Mesabi Trust of its expected shipments of iron ore products, or what percentage of 2022 shipments will be from Mesabi Trust iron ore. In the Cliffs’ Royalty Report, Cliffs stated that the royalty payments being reported today were based on estimated iron ore pellet prices under the Cliffs Pellet Agreements, which are subject to change. It is possible that future negative price adjustments could offset, or even eliminate, royalties or royalty income that would otherwise be payable to Mesabi Trust in any particular quarter, or at year end, thereby potentially reducing cash available for distribution to Mesabi Trust’s Unitholders in future quarters.

Commencement of Idling at Northshore Mining Company

As previously projected by Cliffs, on May 1, 2022 Cliffs commenced the idling of Northshore Mining Company at its operations in Babbitt and Silver Bay, Minnesota. Cliffs’ previous disclosures announced the idling would be for approximately four months, until at least fall 2022, and maybe beyond.

References in this Press Release

All references in this discussion and in this Press Release to iron ore products “shipped” shall include iron ore products that are actually shipped from Silver Bay, Minnesota and/or “deemed shipped” as referenced by the parties to, and in accordance with, the Amended Assignment of Peters Lease. Similarly, all references in this Press Release to “shipments” shall include actual shipments and/or deemed shipments of iron ore products, as referenced by the parties to, and in accordance with, the Amended Assignment of Peters Lease. After the outcome of the AAA arbitration (announced in October 8, 2021) and consistent with Cliffs’ practices, the Trust is entitled to payment upon production of pellets to be sold for internal use by facilities owned by Cliffs or its subsidiaries. As a result, the Trust recognizes revenue for Cliffs’ internal use pellets upon production of those pellets, which are deemed to be shipped under the Amended Assignment of Peters Lease, regardless of pellet grade. Pellets that are not designated for internal use by Cliffs, or its subsidiaries, continue to be recognized as revenue upon shipment from Silver Bay, Minnesota.