ANNUAL FINANCIAL INFORMATION

PURSUANT TO RULE 15C2-12 OF THE

SECURITIES EXCHANGE ACT OF 1934FOR THE FISCAL YEAR ENDED DECEMBER 31, 2011

ARCELORMITTAL USA LLC(Exact Name as Specified In Its Charter)

Delaware 71-0871875(State or Other Jurisdiction of

Incorporation or Organization)(I.R.S. Employer

Identification Number)

1 South Dearborn, Chicago, Illinois 60603(Address of Principal Executive Offices) (Zip Code)

Telephone number, including area code:(312) 899-3400

ArcelorMittal USA LLC Annual ReportTable of Contents

Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Our Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Steel Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Sales, Customer Service and Product Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Raw Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Unfair Trade Practices and Trade Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Forward- Looking Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15Management’s Narrative Analysis-Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17Independent Auditors’ Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20Consolidated Statements of Operations for the years ended December 31, 2011, 2010 and 2009 . . . . . . . . . . 21Consolidated Statements of Comprehensive Loss for the years ended December 31, 2011, 2010 and 2009 . . 22Consolidated Balance Sheets as of December 31, 2011 and 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23Consolidated Statements of Cash Flows for the years ended December 31, 2011, 2010 and 2009 . . . . . . . . . . 24Consolidated Statements of Member Equity for years ended December 31, 2011, 2010, and 2009 . . . . . . . . . 25Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26Nature of Business, Basis of Presentation and Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26Summary of Significant Accounting Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27Segment Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32Impairment Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33Joint Ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34Debt and Capital Lease Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Related Party Balances and Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38Derivative Instruments and Hedging Activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39Contingencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44Stock Based Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46Pension and Other Postretirement Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57Closure and Severance Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61Environmental Matters and Asset Retirement Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62Accumulated Other Comprehensive Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

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ArcelorMittal USA LLC1 South Dearborn, Chicago, Illinois 60603

BUSINESS

Our Company

ArcelorMittal USA LLC, or ArcelorMittal USA, or the Company, is one of the largest steelmakers inNorth America and serves a broad U.S. manufacturing base. ArcelorMittal USA has operations in 10 states of theUnited States with an annual raw steel production capability of about 23 million net tons. When referring toArcelorMittal USA’s operations, net tons means short tons equal to 2,000 pounds. ArcelorMittal USA is anindirect wholly owned subsidiary of ArcelorMittal S.A. (ArcelorMittal).

ArcelorMittal is the world’s largest and most global steel producer and the world’s fourth largest iron oreproducer. It results from the combination in 2006 of Mittal Steel Company N.V. (Mittal) and Arcelor S.A., at thetime the world’s largest and second largest steel companies by production volume. In 2011 ArcelorMittal hadsales of $94.0 billion, steel shipments of 85.8 million metric tons, crude steel production of 91.9 million metrictons, iron ore production of 65.2 million metric tons and coal production of 8.9 million metric tons. In 2010ArcelorMittal had sales of $78.0 billion, steel shipments of 85.0 million metric tons, crude steel production of90.6 million metric tons, iron ore production of 68.6 million metric tons and coal production of 7.4 million metrictons. ArcelorMittal has steelmaking operations in 20 countries on four continents including 60 integrated, mini-mill, and integrated mini-mill facilities and a global portfolio of 16 operating units with mines in operation anddevelopment.

On April 15, 2005, Mittal, ArcelorMittal’s predecessor, acquired International Steel Group Inc. (ISG) whichwas renamed Mittal Steel USA ISG Inc. Effective December 31, 2005, Mittal Steel USA ISG Inc. merged withIspat Inland Inc. (Inland) another indirect wholly owned subsidiary of Mittal. Mittal Steel USA ISG Inc. was thesurviving subsidiary and was renamed Mittal Steel USA Inc. and was subsequently renamed ArcelorMittal USAInc. Effective December 21, 2010 ArcelorMittal USA Inc. was converted from a corporation to a limited liabilitycompany or LLC.

Steel Production

Steel is produced either by integrated steel facilities or electric arc furnaces. Integrated mills use blastfurnaces to produce hot metal typically from iron ore, limestone and coke. Coke is a refined carbon productproduced by firing coal in large coke ovens. Hot metal is then converted through the basic oxygen process intoliquid steel where it can be metallurgically refined. For flat rolled steel products, liquid steel is either teemed intoingots for later processing or cast into slabs in a continuous caster machine. The slabs are further shaped or rolledat a plate mill or hot strip mill. In the production of sheet products, the hot strip mill process may be followed byvarious finishing processes, including pickling, cold-rolling, annealing, tempering or coating processes, includinggalvanizing (zinc coating). These various processes are often distinct steps undertaken at different times ratherthan during a continuous process and may take place in separate facilities. Steel produced by integrated millstends to be cleaner or purer than steel produced by electric arc furnaces since less scrap is used in the productionprocess and scrap contains non-ferrous tramp elements. These purer products are more often required for value-added applications.

A mini-mill uses an electric arc furnace to melt steel scrap or scrap substitutes. This process is often used toproduce a variety of long products. For flat rolled products, liquid steel from the electric arc furnace is cast intoslabs in a continuous casting process. The slabs are then rolled into finished product. Mini-mills are designed toaccommodate shorter production runs with relatively fast product change-over time. Mini-mills generallyproduce a narrower range of steel products than integrated producers and their products tend to be more of acommodity; however, mini-mills have historically enjoyed certain competitive advantages as compared tointegrated mills, including lower required capital investment and lower labor costs per ton shipped.

Products

ArcelorMittal USA’s principal products include a broad range of hot-rolled, cold-rolled and coated sheets,tin mill products, carbon and alloy plates, wire rod, rail products, bars and semi-finished shapes to serve the

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automotive, construction, pipe and tube, appliance, container and machinery markets. All of these products areavailable in standard carbon grades as well as high strength, low alloy grades for more demanding applications.

Hot-Rolled Products. All coiled flat-rolled steel is initially hot-rolled by passing a slab through amultistand rolling mill to reduce its thickness to less than 5/8 inch. Hot-rolled steel destined for the sheet marketcan be either shipped as black band, or cleaned in an acid bath and sold as pickled band. These products are usedin non-critical surface applications such as automotive frames and wheels, construction products, pipe,off-highway equipment and guardrails.

Cold-Rolled Products. Cold-rolled sheet is hot-rolled coil that has been further processed through a picklerand then passed through a rolling mill without reheating until the desired gauge, or thickness, and other physicalproperties have been achieved. Cold-rolling reduces gauge and hardens the steel. Further processing through anannealing furnace and a temper mill improves ductility and formability. Cold-rolling can also impart varioussurface finishes and textures. Cold-rolled sheet is used in, among other things, steel applications that demandhigher surface quality, such as exposed automobile and appliance panels. Cold-rolled sheet prices are usuallyhigher than hot-rolled steel prices. For certain applications, cold-rolled sheet is coated or painted.

Coated Products. Either hot-rolled or cold-rolled coil may be coated with zinc, aluminum or acombination thereof to render it corrosion resistant. Hot-dipped galvanized, galvannealed, Galvalume®,electrogalvanized and aluminized products are types of coated steel. These are also amongst the highest value-added sheet products because they require the greatest degree of processing and usually have the strictest qualityrequirements. Coated steel products are generally used in applications such as automobiles, householdappliances, roofing and siding, heating and air conditioning equipment, air ducts, switch boxes, chimney flues,awnings and grain bins.

Plate. Plate is steel that is generally more than 3/16 inch thick. It can be made on either a coiled plate millup to 1-inch thick or a discrete plate mill. The coiled plate or discrete plate is then cut into sections for specificend uses. Commodity steel plate is used in a variety of applications such as storage tanks, ships and railcars, largediameter pipe and machinery parts. More specialized steel plate, such as high-strength-low alloy, heat-treated, oralloy plate, can have superior strength and performance characteristics for particular applications such as themanufacture of construction, mining and logging equipment; pressure vessels and oil and gas transmission lines;and the fabrication of bridges and buildings. Quenched and tempered plate is harder and stronger and can be usedin products such as military armor and hard rock mining equipment.

Tin Products. Tin mill sheet steel is used to produce food and other containers. It is available as blackplate, tin plate and tin-free steel. Black plate is an uncoated thin gauge cold rolled steel, tin plate is black plateelectrolytically plated with metallic tin and tin-free steel is black plate that has been electrolytically plated withmetallic chromium and chromium oxides. Both tin plate and tin-free steel undergo a plating process whereby themolecules from the positively charged tin or chromium anode attach to the negatively charged sheet steel. Thethickness of the coating is readily controlled through regulation of the voltage and speed of the sheet through theplating area.

Bars. Bars are long steel products that are rolled from billets. Merchant bars include rounds, flats, angles,squares, and channels that are used by fabricators to manufacture a wide variety of products such as furniture,stair railings, and farm equipment.

Rail. Billets and blooms are fed through rollers that form rail. Rail is produced in a number of sectionsdetermined by their weight per yard and relative strengths. Rail is sold to railroad companies and regional transitauthorities for new track projects and for the repair of existing track.

Wire Rod. Billets are fed through rolls that form wire rod. Wire rod is produced in a variety of grades anddimensions for further processing into wire products or fabricated to make fasteners.

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Reinforcing Bar (Rebar). Billets are fed through rolls to form rebar. Rebar is used in construction withconcrete and masonry structures.

Customers

ArcelorMittal USA sells its products to a highly diversified customer base representing all major steel-consuming markets as well as to third-party processors and service centers. Its customers are primarily in theMidwest of the United States.

Direct Sales to End-Users. ArcelorMittal USA primarily sells directly to end-users representing a widerange of consuming markets, including automotive, construction, appliance, transportation, container, energy,machinery and equipment. Its sales, technical and engineering staff are organized with both a specific product(plate, flat rolled, tinplate, bar, wire rod and rail products) and market focus.

Sales to Intermediate Processors and Steel Service Centers. A significant portion of our sales are tointermediate processors and steel service centers. These processors and steel service centers typically act asintermediaries between steel producers and various end-user manufacturers that require further processing orinventory programs. The additional services performed by steel service centers and processors include pickling,galvanizing, cutting to length, slitting to size, leveling, blanking, shape correcting, edge rolling, shearing andstamping.

Contract and Spot Sales. Less than half of our sales were sold on the spot market with price terms of threemonths or less with the majority of sales through longer term customer contracts of various durations.

International Sales. Historically, the opportunities for sales outside the United States of steel productshave been intermittent and highly competitive and our international sales have been minimal.

Sales, Customer Service and Product Development

To properly service its customers, ArcelorMittal USA has a knowledgeable and dedicated sales forceresponsible for soliciting and servicing steel consumers. The sales organization is focused and organized by steelconsuming market segments and is directed from a centralized commercial leadership group which providesclarity and uniformity to the market. In addition, we have a customer service organization that works closely withour scheduling, operations, quality, and logistics organizations to provide information and service related to orderfulfillment.

Technical resources exist within each division sales group, supported by plant technical personnel to helpcustomers specify the proper material for each end-use. ArcelorMittal USA has a research and productdevelopment facility in northwest Indiana.

Competition

Competition within the steel industry, both in the United States and globally, is intense and expected toremain so. Our primary U.S. competitors are United States Steel Corporation, Nucor Corporation, OAOSeverstal, AK Steel Holding Corporation, RG Steel, LLC, and Svenskt Stal AB (SSAB). The steel market in theUnited States is also served by a number of non-U.S. sources and U.S. supply is subject to changes in worldwidedemand and currency fluctuations, among other factors.

Numerous companies in the steel industry declared bankruptcy in the past ten years. They have either ceasedproduction or more often continued to operate after being acquired or reorganized. In addition, somenon-U.S. steel producers are owned and supported by their governments and their decisions with respect to

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production and sales may be influenced by political and economic policy considerations rather than by prevailingmarket conditions. The global steel industry is characterized by cyclical demand, resulting in periods of over andunder capacity that result in upward and downward pressure on prices and gross margins.

ArcelorMittal USA competes with other flat-rolled steel producers (both integrated steel mills and mini-mills) and producers of plastics, aluminum, ceramics, carbon fiber, concrete, glass, plastic and wood that can beused in lieu of flat-rolled steels in manufactured products. Mini-mills generally offer a narrower range ofproducts than integrated steel mills but can have some cost advantages as a result of their different productionprocesses.

The competition in the discrete plate business, both carbon and alloy, is somewhat fragmented withArcelorMittal USA having the largest capability and the widest product range domestically.

Price, quality, delivery, service, and product development are the primary competitive factors in all marketsthat ArcelorMittal USA serves and vary in relative importance according to the product category and specificcustomer.

Raw Materials

Our business depends on continued access to reliable supplies of various raw materials, principally, iron ore,coal, coke, scrap, energy, alloys and industrial gases. ArcelorMittal USA believes there will be adequate sourcesof its principal raw materials to meet its near term needs.

Iron Ore

For an integrated steelmaker, iron ore is an essential element in the production of steel. When all blastfurnaces are operating, ArcelorMittal USA annually consumes about 23.8 million net tons of iron ore pellets and1.2 million net tons of iron ore fines. Substantially all of our ore requirements are under contract or supplied byentities in which ArcelorMittal USA maintains an ownership interest. ArcelorMittal USA has contracts withCliffs Natural Resources Inc. (Cliffs) to purchase iron ore pellets. The Hibbing Taconite joint venture’s mine andprocessing facilities supply substantially all of Burns Harbor’s current annual pellet requirements and areoperated by Cliffs, who also owns approximately 23% of the joint venture; US Steel-Canada owns approximately15%. Additionally, ArcelorMittal USA owns 21% of the Empire mine in Michigan, the remainder of which isowned by Cliffs, who manages the mine. ArcelorMittal USA supplies the Indiana Harbor East facility through itsshare of Empire pellets, through the Cliffs’ Inland contract described below, and with pellets from theArcelorMittal USA-owned Minorca Mine in Minnesota.

The Inland Agreement with Cliffs runs through January 31, 2015 and provides a significant amount ofpellets for Indiana Harbor East. Under the contract, the range of volume at ArcelorMittal USA’s option is 2.8 to3.9 million net tons per year (inclusive of AMUSA’s share of pellets as a 21% owner in the Empire mine), andCliffs must make commercially reasonable efforts to supply any additional required tonnage. The InlandAgreement’s pricing mechanism features a world market-based pricing mechanism in which the pellet price isindexed to the Platts published price for iron ore fines on a quarterly basis. In August 2010, ArcelorMittal USAidled two of its three furnaces at Indiana Harbor East, which reduced ArcelorMittal USA’s required minimumpurchase under the agreement to 2.3 million net tons for 2011 and 1.35 million net tons for subsequent years aslong as these furnaces are down through at least August 2012.

The ISG Agreement with Cliffs runs through December 31, 2016 and requires ArcelorMittal USA topurchase and Cliffs to sell and deliver tonnage meeting ArcelorMittal USA’s annual requirements for theCleveland and Indiana Harbor West facilities. Historically, this volume is typically between 6.7 and 9 million nettons. These pellets are priced on the basis of a formula linked to certain Bureau of Labor Statistic Producer PriceIndices and the actual realized hot band price for the consuming facility.

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Coal and Coke

Coke, a refined carbon product produced by baking coal to drive off volatile matter, is the principal fuelused to produce hot metal in our blast furnaces. ArcelorMittal USA annually consumes about 7 million dry nettons of coke. Our coke batteries in Warren, Ohio and Burns Harbor, Indiana supply about 2.3 million net tons.ArcelorMittal USA has multiple long-term contracts with various coke producers, including one that operates acoke oven battery located at our Indiana Harbor East facility. ArcelorMittal USA has also purchased coke fromother ArcelorMittal facilities. We obtain the balance of our requirements from international sources at marketprices. ArcelorMittal USA uses about 5 million net tons of coal per year. ArcelorMittal USA has contracts forsubstantially all of its requirements for its coke oven batteries and coal injection systems. ArcelorMittal USAdoes, however, periodically buy small amounts of coal in the spot market for specific needs.

Scrap

Historically, ArcelorMittal USA uses hot metal for about 75% of its basic oxygen furnace charge and scrapfor about 25%. These percentages could vary depending on the relative costs, availability and other factors.About half of such scrap used by ArcelorMittal USA is generated at its own facilities. Our electric arc furnacesuse scrap for all of their production, of which only a small portion is internally generated. ArcelorMittal USAconsumes about 4 million net tons of purchased scrap per year. There are no long-term scrap contracts availableas all purchases are in a short-term open market. Electric arc furnace steelmakers primarily use scrap in productsand are therefore vulnerable to scrap price movements. ArcelorMittal USA expects scrap to continue to be insufficient supply to satisfy its needs.

Energy and Industrial Gases

Our steel operations consume large amounts of electricity, natural gas, oxygen and other industrial gases.ArcelorMittal USA purchases its electrical power requirements from various suppliers. In addition, ArcelorMittalUSA operates cogeneration facilities on certain of its sites that utilize waste gases from the blast furnaces tosupplement its electrical power requirements and control its energy costs. ArcelorMittal USA purchases naturalgas under short-term supply contracts with a common group of suppliers. ArcelorMittal USA uses financialinstruments to hedge such purchases when appropriate. Various service providers provide transportation of thenatural gas to our facilities. ArcelorMittal USA also has several long-term contracts to supply its oxygen,hydrogen, argon and nitrogen gas requirements.

Employees

About 78% of our employees are represented by unions, primarily the United Steelworkers (USW). Thecollective bargaining agreement between ArcelorMittal USA and the USW is effective from September 1, 2008and expires on September 1, 2012. For additional information on the agreement, see Note 11, Pension and OtherPostretirement Benefit Plans.

Unfair Trade Practices and Trade Remedies

Under international agreement and U.S. law, remedies are available to domestic industries where importsare “dumped” or “subsidized” and such imports cause material injury to a domestic industry. Dumping involvesselling for export a product at a price lower than the same or similar product is sold in the home market of theexporter or where the export prices are lower than a value that typically must be at or above the full cost ofproduction. Subsidies from governments (including, among other things, grants and loans at artificially lowinterest rates) under certain circumstances are similarly actionable. The remedy available is an antidumping dutyorder or suspension agreement where injurious dumping is found and a countervailing duty order or suspensionagreement where injurious subsidization is found. When dumping or subsidies continue after the issuance of anorder, a duty equal to the amount of dumping or subsidization is imposed on the importer of the product. Such

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orders and suspension agreements do not prevent the importation of product, but rather require either that theproduct be priced at an undumped level or without the benefit of subsidies or that the importer pay to theU.S. government as a duty the difference between such undumped or unsubsidized price and the actual price.

Environmental Matters

Our operations are subject to a broad range of laws and regulations relating to the protection of humanhealth and the environment. The prior owners of our facilities expended in the past, and we expect to expend inthe future, substantial amounts to maintain ongoing compliance with U.S. federal, state, and local laws andregulations, including the Resource Conservation and Recovery Act (RCRA), the Clean Air Act, and the CleanWater Act. These environmental expenditures are not projected to have a material adverse effect on ourconsolidated financial position or on our competitive position with respect to other similarly situatedU.S. steelmakers subject to the same environmental requirements.

RCRA

Under RCRA and similar U.S. state programs, the owners of certain facilities that manage hazardous wastesare required to investigate and, if appropriate, remediate historic environmental contamination found at suchfacilities. All of our major operating and inactive facilities are or may be subject to a corrective action program orother laws and regulations relating to environmental remediation, including projects relating to the reclamation ofindustrial properties, also known as brownfield projects.

Clean Air Act

Our facilities are subject to a variety of permitting requirements under the Clean Air Act that restricts thetype and amount of air pollutants that may be emitted from regulated emission sources.

In addition, other Clean Air Act requirements, such as revisions to national ambient air quality standards forozone, particulate matter, and mercury emissions may have significant impacts on us in the future, althoughwhether and how it will be affected cannot be determined for many years. We also may be affected when theU.S. federal government or the states in which it operates begin to regulate emissions of greenhouse gases suchas carbon dioxide. However, because we cannot predict what requirements will be imposed on it or the timing ofsuch requirements, we are unable to evaluate the ultimate future cost of compliance with respect to thesepotential developments at this time.

Clean Water Act

Our facilities also are subject to a variety of permitting requirements under the Clean Water Act, whichrestricts the type and amount of pollutants that may be discharged from regulatory sources into receiving bodiesof waters, such as rivers, lakes and oceans. The U.S. Environmental Protection Agency (EPA) issued regulationsthat require existing wastewater dischargers to comply with effluent limitations. Several of our facilities aresubject to these regulations, and compliance with such regulations will be required as new discharge permits areissued for continued or expanded operations. We are unable to evaluate the cost with respect to these futurepermit requirements.

Mine Safety and Health Administration Safety Data

ArcelorMittal USA owns the Minorca iron mining operation in Minnesota. The Company places strongemphasis on protecting the health and safety of each of its employees. Safety is one of our core values, and wehave received a number of awards for our safety performance. As part of this effort, we have implemented anintensive safety training program, which focuses on hazard identification, risk assessment, hazard mitigation andemployee feedback for continuous improvement. These programs encourage all Company employees tochampion the safety process.

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Our mining operation is governed by both the U.S. Mine Safety and Health Administration (MSHA) andstate regulatory agencies. The Federal Mine Safety and Health Act of 1977, as amended (the FMSH Act), andstate regulatory agencies, among others, impose stringent safety and health standards on all aspects of miningoperations, which are enforced through regular inspections. Although the Company aims to conduct its miningand other operations in compliance with all applicable U.S. federal, state and local laws and regulations,violations do occur from time to time.

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act), signed intoLaw on July 21, 2010, each operator of a mine is required to include certain mine safety information within itsperiodic reports. As required by Section #503 of the Dodd-Frank Act, we present in the table below, thefollowing items regarding certain mining safety and health matters for the Company’s mine location covered bythe Dodd-Frank Act.

(A) The total number of violations of mandatory health or safety standards that could significantly andsubstantially contribute to the cause and effect of a coal or other mine safety or health hazard under section 104of the FMSH Act (30 U.S.C. 814) for which the operator received a citation from MSHA;

(B) The total number of orders issued under section 104(b) of the FMSH Act (30 U.S.C. 814(b));

(C) The total number of citations and orders for unwarrantable failure of the mine operator to comply withmandatory health or safety standards under section 104(d) of the FMSH Act (30 U.S.C. 814(d));

(D) The total number of flagrant violations under section 110(b)(2) of the FMSH Act (30 U.S.C. 820(b)(2));

(E) The total number of imminent danger orders issued under section 107(a) of the FMSH Act (30 U.S.C.817(a));

(F) The total dollar value of proposed assessments from MSHA under the FMSH Act (30 U.S.C. 801 etseq.); and

(G) The total number of mining-related fatalities.

In 2011, our operations did not receive any flagrant violations under section 110(b)(2) of the FMSH Act orany written notice from MSHA of a pattern of violations under section 104(e) of the FMSH Act (nor the potentialto have such a pattern). In addition, the Company’s mining operations experienced no mining-related fatalitiesduring the reporting period.

Dodd-Frank Wall Street Reform and Consumer Protection Act

SEC 1503 — Mine Strategy Requirements

Periods Covered: Twelve months ended December 31, 2011

Twelve Months Ended December 31, 2011*

(A) (B) (C) (D) (E) (F) (G) (H1) (H2) (I)

Mine NameandLocation

Operation Section104

Section104(b)

Section104(d)

Section110(b)(2)

Section107(a)

ProposedAssessments

Fatalities The minesite has apattern ofviolationsofmandatoryhealth orSafetystandards

Thepotentialto havesuch apattern ofviolations

PendingLegalAction

MinorcaMineVirginiaMinnesota

Iron Ore 30 1 0 0 0 $178,516 0 No None atthis time

None

Reporting Requirement Description

(A) The total number of violations of mandatory health or safety standards that could significantly andsubstantially contribute to the cause and effect of a mine safety or health hazard under section 104 of the

9

Mine Safety and Health Act of 1977 (30 U.S.C. 814) for which the operator received a citation from theMine Safety and Health Administration

(B) The total number of orders issued under section 104(b) of such Act (30 U.S.C. 814(b))

(C) The total number of citations and orders for unwarrantable failure of the mine operator to comply withmandatory health or safety standards under section 104(d) of such Act (30 U.S.C. 814(d))

(D) The total number of flagrant violations under section 110(b)(2) of such Act (30 U.S.C. 820(b)(2))

(E) The total number of imminent danger orders issued under section 107(a) of such Act (30 U.S.C. 817(a))

(F) The total dollar value of proposed assessments from the Mine Safety and Health Administration under suchAct (30 U.S.C. 801 et seq.)

(G) The total number of mining-related fatalities

(H) Operations that receive written notice from the Mine Safety and Health Administration of — (1) a pattern ofviolations of mandatory health or safety standards that are of such nature as could have significantly andsubstantially contributed to the cause and effect of coal or other mine health and safety hazards undersection 104(e) of such Act (30 U.S.C. 814 (e)); or (2) the potential to have such a pattern.

(I) Any pending legal action before the Federal Mine Safety and Health Review Commission.

Note: There is no materiality threshold for the required safety information presented above.

* The Company owns, directly or indirectly, a 62.3% interest in Hibbing Taconite Company, located inMinnesota, and a 21% interest in the Empire Iron Mining Partnership, located in Michigan. The iron minesand pelletizing plants held by these entities are operated by affiliates of Cliffs Natural Resources Inc., whichprovides the required disclosure under Section 1503 in respect of these sites. See “Item 15 Exhibit 95 —Mine Safety Disclosures” in the Form 10-K filed by Cliffs Natural Resources Inc. on February 16, 2012 formore information.

Intellectual Property

ArcelorMittal USA owns a number of U.S. and non-U.S. patents that relate to a wide variety of products andprocesses, has filed pending patent applications and is licensed under a number of patents. However,ArcelorMittal USA believes no single patent or license or group of patents or licenses is of material importanceto our overall business. ArcelorMittal USA also owns registered trademarks for certain of its products andservice marks for certain of its services, which, unlike patents and licenses, are renewable so long as they arecontinued in use and properly protected.

FORWARD-LOOKING STATEMENTS

ArcelorMittal USA and its representatives may from time to time make forward-looking statements in thisreport, news releases, other written documents and oral presentations. These forward-looking statements may beidentified by the use of predictive, future-tense or forward-looking terminology, such as “believes,” “outlook,”“anticipates,” “expects,” “estimates,” “intends,” “may” or similar terms. These statements speak only as of thedate of such statements and ArcelorMittal USA will undertake no ongoing obligation to update these statements.Any such forward-looking statements are not guarantees of future performance and involve significant risks anduncertainties. Actual results may differ materially from those contained in these statements.

Risk Factors

Our business, financial condition or results of operations could be materially adversely affected by any ofthe risks and uncertainties described below. Factors that could affect our results or performance include thefollowing:

• ArcelorMittal USA may encounter supply shortages and increases in the cost of raw materials, energy andtransportation.

10

• ArcelorMittal USA may face significant price and other forms of competition from other steel producers,which could have a material adverse effect on our business, financial condition, results of operations orprospects.

• ArcelorMittal USA is susceptible to the cyclicality of the steel industry.

• ArcelorMittal USA is susceptible to the risk of protracted weakness in steel prices or of price volatility.

• Under-funding of pension and other postretirement benefit plans and the need to make substantial cashcontributions to pension plans, which may increase in the future, may reduce the cash available forArcelorMittal USA’s business.

• Steel companies are susceptible to changes in governmental policies and international economicconditions.

• The downturn in the global economy during 2008 and 2009 caused a sharp reduction in worldwidedemand for steel, and the recovery through 2010 and 2011 has been slow and uncertain. Should the globaleconomy or the economies of ArcelorMittal USA’s key selling markets endure a protracted period ofweak growth or fall back into recession, this would have a material adverse effect on the steel industryand ArcelorMittal USA.

• Competition for other materials may have a material adverse effect on ArcelorMittal USA’s business,financial condition, results of operations or prospects.

• ArcelorMittal USA could experience labor disputes that could disrupt operations.

• Equipment downtime or shutdowns could adversely affect ArcelorMittal USA’s business, financialcondition, results of operations or prospects.

• The income tax liability of ArcelorMittal USA may substantially increase if the tax laws and regulationschange or become subject to adverse interpretations or inconsistent enforcement or if ArcelorMittal USAis unable to utilize certain tax benefits.

• Steel companies are subject to stringent environmental regulations, and ArcelorMittal USA may berequired to spend considerable amounts of money in order to comply with such regulations.

• ArcelorMittal USA’s insurance policies provide limited coverage, potentially leaving us uninsuredagainst business risks.

• Product liability claims and lawsuits, including those related to antitrust matters could adversely affectArcelorMittal USA’s financial conditions.

• ArcelorMittal USA requires substantial capital investment and maintenance expenditures, which we maybe unable to provide.

• ArcelorMittal USA’s debt level may limit our flexibility in managing our business.

• ArcelorMittal USA has variable rate indebtedness that subjects us to interest rate risk, which could causeour annual debt service obligations to increase.

• ArcelorMittal USA’s reputation and business could be materially harmed as a result of data breaches, datatheft, unauthorized access or successful hacking.

PROPERTIES

Principal Operating Facilities

Our steel operations consist of four integrated steelmaking plants, one basic oxygen furnace/compact stripmill, five electric arc furnace plants with raw steel production capability of 23 million net tons and five finishingplants. We own all or substantially all of each plant. We also own interests in various joint ventures that supportthese facilities, as well as several raw material, railroad and transportation assets.

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Integrated Steelmaking Facilities

Burns Harbor: Burns Harbor is located in Indiana on Lake Michigan, about 50 miles southeast of Chicago,Illinois. Burns Harbor is an integrated mill capable of producing hot-rolled sheet, cold-rolled sheet, hot dipgalvanized sheet and steel plate for use in automotive, appliance, service center, construction, and ship buildingapplications. Burns Harbor’s iron producing facilities include a sintering plant, two coke oven batteries and twoblast furnaces with granularized coal injection capable of producing about 4.8 million net tons of hot metal peryear. The steel producing shop consists of three basic oxygen furnaces, one degasser, two ladle treatmentstations, two continuous slab casters (an 84-inch two strand and a 76-inch two strand) capable of producing about4.7 million net tons of raw steel per year. Finishing facilities include an 80-inch hot-strip mill, two 80-inchcontinuous pickling lines, an 80-inch five-stand tandem mill, batch annealing facilities, a continuous anneal line,an 80-inch five stand temper mill, a 72-inch hot dip galvanizing line, which is capable of producing bothgalvanized and galvannealed sheets, and two plate mills (160-inch and 110-inch). Burns Harbor also operates athird plate mill and associated heat-treating facilities in Gary, Indiana.

Indiana Harbor:

Indiana Harbor West: Indiana Harbor West is located in Indiana, about 20 miles southeast ofChicago, Illinois on Lake Michigan. Indiana Harbor West is an integrated mill capable of producing hot-rolledsheet, aluminized sheet, cold-rolled sheet, and hot dip galvanized sheet for use in automotive, appliance, servicecenter, tubular, strip converters, and contractor applications. Indiana Harbor West’s iron producing facilitiesinclude a sintering plant and two blast furnaces capable of producing about 3.6 million net tons of hot metal peryear. The steel producing shop consists of two basic oxygen furnaces, two ladle metallurgy stations, a vacuumdegasser and two continuous slab casters (88-inch one strand and 80-inch one strand) capable of producing4.0 million net tons of raw steel per year. Finishing facilities include an 84-inch hot-strip mill, a 76-inch pickleline, an 80-inch five stand tandem mill, batch annealing facilities, a two stand temper mill, a 72-inch hot dipgalvanizing line and a 60-inch aluminizing line.

Indiana Harbor East: Indiana Harbor East is located in Indiana next to our Indiana Harbor Westfacility. This is an integrated mill capable of producing hot-rolled sheet, cold-rolled sheet, hot dip galvanizedsheet and bar products for use in automotive, appliance, service center, tubular, strip converters, and contractorapplications. Indiana Harbor East’s iron producing facilities include three blast furnaces capable of producingabout 5.7 million net tons of hot metal per year. The steel producing shop consists of four basic oxygen furnacesand three slab and bloom casters capable of producing 5.9 million net tons of raw steel per year. Finishingfacilities include an 80-inch hot-strip mill, a continuous pickle line, an 80-inch tandem mill, continuous and batchannealing facilities, two temper rolling mills, and one coating line. ArcelorMittal Minorca, which supports theoperations of Indiana Harbor East, holds mining rights over 13,210 acres of land and has operations locatedapproximately 2 miles north of the town of Virginia in the northeast of Minnesota. Pellets are transported by railto ports on Lake Superior. Lake vessels are used to transport the pellets to Indiana Harbor.

Cleveland: Cleveland is located on opposite banks of the Cuyahoga River, near Lake Erie in Cleveland,Ohio. Cleveland is an integrated mill capable of producing hot-rolled sheet, cold-rolled sheet, and hot dipgalvanized sheet for automotive, strip converter, service center and tubular applications. Its iron producingfacilities include a coke oven battery located in Warren, Ohio and two blast furnaces that are capable ofproducing about 3.1 million net tons of hot metal per year. Cleveland has two steel producing shops. The westside shop consists of two basic oxygen furnaces, a ladle metallurgy station and a 63-inch two strand caster. Theeast side shop includes two basic oxygen furnaces, a ladle metallurgy station, a degasser and a 73-inch two strandcaster. The two shops combined are capable of producing about 3.8 million net tons of raw steel per year.Finishing facilities include an 84-inch hot strip mill, an 84-inch continuous pickling line, an 84-inch five standtandem mill, batch annealing facilities, an 84-inch one stand temper mill and a hot dip galvanizing line.

Basic Oxygen Furnace/Compact Strip Caster

Riverdale: Our Riverdale, Illinois facility is located about 14 miles west of our Indiana Harbor facilities.Riverdale produces hot rolled sheet for strip converter and service center applications. Hot metal can be suppliedfrom either our Indiana Harbor or Burns Harbor blast furnaces to Riverdale’s basic oxygen

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furnaces. Principal facilities include a steel producing shop with two basic oxygen furnaces, two ladle metallurgyfacilities and a 63-inch one strand continuous slab caster which uses a compact strip process capable ofproducing about 0.8 million net tons of raw steel per year. This caster directly feeds a 62-inch wide tunnelfurnace and a seven stand hot-strip rolling mill. The Riverdale compact strip mill incorporates the latest castingand rolling technology designs.

Electric Arc Furnaces

Coatesville: Our Coatesville, Pennsylvania facility is located about 45 miles west of Philadelphia,Pennsylvania. Coatesville is capable of producing over 450 different chemistries including a wide range ofcarbon and alloy discreet plate products (including carbon, high-strength, low alloy, commercial alloy, militaryalloy, flame-cut and clad) for use in infrastructure, chemical process facilities and shipbuilding applications.Steel producing facilities consist of an alternating current electric arc furnace capable of producing about0.9 million tons of liquid steel per year, a vacuum degasser, an ingot teaming facility, and an 85-inch strand slabcaster capable of producing about 0.8 million net tons of raw steel per year. Finishing facilities include two platemills (a 140-inch and a 206-inch) and heat-treating facilities. An additional finishing facility in Piedmont, NorthCarolina provides plasma arc cutting capabilities.

Steelton: Our Steelton, Pennsylvania facility is located about 100 miles west of Philadelphia,Pennsylvania. Steelton produces railroad rails, specialty blooms, and flat bars for use in railroad and forgingmarkets. Steelton’s steel producing facilities consist of a direct current electric arc furnace capable of producingabout 1.1 million net tons of liquid steel per year, a ladle arc reheating furnace, a vacuum degasser, a three strandcontinuous bloom caster and an ingot teaming facility capable of producing about 1.0 million net tons of rawsteel per year. Finishing operations include a 44-inch blooming mill, a 28-inch rail mill, in-line rail head-hardening facilities, rail finishing and a 20-inch bar mill.

Georgetown: Our Georgetown, South Carolina facility is located on Winyah Bay. Georgetown produceswire rod for use by converters and original equipment manufacturers. Steel producing facilities consist of twoalternating current electric arc furnaces capable of producing about 1.0 million net tons of liquid steel per year,with two ladle metallurgy stations, and a six strand continuous billet caster capable of producing about1.0 million net tons of raw steel per year. Finishing operations include a wire rod rolling mill capable ofproducing 0.8 million net tons of wire rod per year. Georgetown’s location provides deep water access and thecapability to ship products and receive raw materials by ship.

Indiana Harbor Bar: Located adjacent to Indiana Harbor East facility is an electric arc furnace capable ofproducing 0.6 million tons of liquid steel per year, a continuous billet caster and a 12-inch bar mill.

Vinton: Our Vinton, Texas facility is located about 20 miles north of El Paso. It has two electric arcfurnaces capable of producing 0.2 million net tons of liquid steel, a continuous caster, and a rolling mill. Itproduces reinforcing bar and grinding balls which it sells in the southwestern U.S.

Rolling and Finishing Facilities

Conshohocken: Our Conshohocken facility is located in Conshohocken, Pennsylvania, about 15 milesnorth of Philadelphia, Pennsylvania. Conshohocken produces both coil and discreet plate for use in constructionand military applications. Slabs are provided by our other facilities. Principal facilities consist of a 110-inchSteckel mill and heat treat facilities.

Weirton: Our Weirton, West Virginia facility is located near the Ohio River. Weirton is capable ofproducing tin mill products for use mainly in the packaging markets. Finishing facilities include a 54-inchcontinuous pickler, a 48-inch five stand tandem cold mill, batch anneal, two continuous anneal lines, one tempermill, one double cold reducing mill, one chrome line, and two tin plate lines. The finishing facilities are suppliedfrom steel produced at our other facilities.

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Columbus: Our Columbus, Ohio facility produces hot dip galvanized sheet for the automotive market. OurBurns Harbor and Indiana Harbor facilities supply cold-rolled coils. The principal operating facility includes a72-inch hot dip galvanizing line. We also operate a nearby slitter and warehousing facility.

Hennepin: Our Hennepin, Illinois facility was closed in 2009. Production was shifted to other locations.

Lackawanna: Our Lackawanna, New York facility was closed in 2009. Production was shifted to otherlocations. We sold all remaining assets, including the land and building, related to the former finishing operationsin 2010. We still retain other property related to the former primary operations.

Railroads, Transportation and Research

We own six short-line railroads that transport raw materials and semi-finished steel products within ourvarious facilities, and an interstate truck broker that serves our facilities. We own a fleet of coal hopper cars usedin unit trains to move coal and coke to Indiana Harbor. We time charter five vessels for the transportation of ironore and limestone on the Great Lakes.

We also own and maintain research and development laboratories in East Chicago, Indiana. Such facilitiesare adequate to serve our present and anticipated needs.

Significant Joint Ventures

I/N Tek: We own a 60% interest in a partnership that operates a 1.7 million ton annual capacity cold-rolling mill on about 200 acres of land, which it owns in fee, located near New Carlisle, Indiana. We do notexercise control over this partnership.

I/N Kote: We own a 50% interest in a partnership that operates a 1.0 million ton annual capacity steelgalvanizing facility on about 25 acres of land, which it owns in fee, located adjacent to the I/N Tek site.

PCI Associates: We own a 50% interest in a partnership that operates a pulverized coal injection facilityon land located within Indiana Harbor East. PCI Associates leases the land upon which the facility is located.

Hibbing Taconite: We own a total 62.3% direct and indirect interest in Hibbing Taconite Company,located in Hibbing, Minnesota, that operates mines and a pelletizing plant. Hibbing Taconite has mining andprocessing facilities that can supply all of Burns Harbor’s iron ore pellet expected needs. We own a 90% interestin Ontario Iron Company, which is located in Hibbing, Minnesota that owns mineral leases used by HibbingTaconite. Because we own an undivided interest in each asset and are liable for our share of each liability, weproportionally consolidate Hibbing Taconite.

Empire Iron Mining: We own a 21% interest in Empire Iron Mining Partnership, located in Palmer,Michigan, which operates an iron ore mine and pelletizing plant. We do not have the ability to exercisesignificant influence over operations or financial policies of Empire Iron Mining. The carrying amount of ourinvestment in this joint venture is zero.

Double G Coatings: We own a 50% interest in Double G Coatings Company, L.P., which is located nearJackson, Mississippi. This company operates a 270,000-ton-per year sheet coating line that produces galvanizedand Galvalume® coated sheets primarily for the construction market. Indiana Harbor West and Cleveland providecold-rolled coils for our share of production.

Steel Health Resources: We own a 47.5% interest in Steel Health Resources, L.L.C., which is located inChesterton, Indiana and owns the building of a healthcare clinic.

Steel Construction Systems: We own a 45% interest in Steel Construction Systems, which is located inOrlando, Florida and manufactures steel studs and roll-formed trusses for residential and light commercialbuildings.

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Burns Harbor Fuels: We own a 49% interest in Burns Harbor Fuels Company which recycles coke ovenwaste material. This is a variable interest entity which we control; as a result it is included in our consolidatedfinancial statements.

Zug Island Fuels: We own a 51% interest in Zug Island Fuels Company which recycles coke oven wastematerial. This is a variable interest entity which is controlled by our partner in the venture; as a result we accountfor it under the equity method.

Neville Island Fuels: We own a 51% interest in Neville Island Fuels Company which recycles coke ovenwaste material. This is a variable interest entity which is controlled by our partner in the venture; as a result weaccount for it under the equity method.

We account for all these joint ventures on the equity method except for Hibbing Taconite, Burns HarborFuels, and Empire Iron Mining.

LEGAL PROCEEDINGS

In the ordinary course of business, we are involved in various pending or threatened legal proceedings. Wecannot predict with certainty the outcome of any legal or environmental proceedings to which we are a party. Inour opinion, however, adequate liabilities have been recorded for losses that are probable to result from legalproceedings and environmental remediation requirements. If such liabilities prove to be inadequate, however, itis reasonably possible that we could be required to record a charge to earnings that could be material to theresults of operations and cash flows in a particular future annual period. We believe that any ultimate additionalliability arising from these actions, that is reasonably possible over what has been recorded, will not be materialto our consolidated financial condition and sufficient liquidity will be available for required payments.

ISG purchased only specified assets of Georgetown, Weirton, Bethlehem, Acme, and LTV through sales inbankruptcy proceedings. The sellers in those transactions retained liability for certain claims related to the assetsthat we purchased, including personal injury claims. The sale orders issued by the U.S. Bankruptcy Courtshaving jurisdiction over each respective transaction entered orders barring assertion of claims (other than those inrespect of certain specifically assumed liabilities, which did not include asbestos-related liabilities) against usrelated to the assets in question, and confirming that neither we nor our subsidiaries shall be responsible for anyliabilities related to the assets (other than those in respect of certain specifically assumed liabilities which did notinclude asbestos-related liabilities). The sale orders issued by the U.S. Bankruptcy Courts also found that underno circumstances could we be deemed a successor to any of the sellers for purposes of any liabilities. We believethe manner through which our facilities were purchased in conjunction with the attendant orders of theU.S. Bankruptcy Court places us in a better position than other steelmakers with substantial exposure to asbestos-related liability or off-site environmental liability. Despite the foregoing it is possible that future claims withrespect to historic asbestos exposure could be directed at us. The risk of incurring liability as the result of suchclaims is considered remote.

On September 12, 2008, Standard Iron Works filed a purported class action complaint in U.S. District Courtin the Northern District of Illinois against ArcelorMittal, ArcelorMittal USA LLC, and other steel manufacturers,alleging that the defendants had conspired since 2005 to restrict the output of steel products in order to fix, raise,stabilize and maintain prices at artificially high levels in violation of U.S. antitrust law. Since the filing of theStandard Iron Works lawsuit, other similar direct purchaser lawsuits have been filed in the same court and havebeen consolidated with the Standard Iron Works lawsuit. In addition, two putative class actions on behalf ofindirect purchasers have been filed, one of which has already been consolidated with the Standard Iron Workscases and one of which ArcelorMittal is seeking to consolidate. In January 2009, ArcelorMittal and the otherdefendants filed a motion to dismiss the direct purchaser claims. On June 12, 2009, the court denied the motionto dismiss and the litigation is now in the discovery stage. At the current time, we are unable to reasonablyestimate the amount of potential liability, if any, from these cases.

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On July 9, 2010 the Chesapeake Bay Foundation, the Baltimore Harbor Waterkeeper, and seven individualsfiled a complaint in the U.S. District Court for the District of Maryland. Severstal Sparrows Point LLC and theCompany are the named Defendants. The Complaint asserts seven separate alleged claims against Defendants:(1) a RCRA citizen suit claim based upon an “imminent and substantial endangerment;” (2) operation of ahazardous waste treatment facility without a permit in violation of RCRA; (3) violation of Maryland HazardousWaste Laws; (4) wastewater discharges in violation of the Clean Water Act (CWA); (5) violation of theMaryland Water Pollution Control Law; (6) violation of the facility’s National Pollutant Discharge EliminationSystem (NPDES) permit under the CWA; and (7) violation of Maryland’s Erosion and Sediment Control Laws.Plaintiffs have demanded a jury trial. ArcelorMittal USA and ISG operated the facility for several years where itis believed to have been in material compliance with all applicable environmental laws and associated standards.On May 7, 2008, OAO Severstal purchased ISG Sparrows Point Steel LLC, its steelmaking operations and realestate. As a result of that sale, Severstal became fully responsible for the operation of the Sparrows Point plant.The Company has no continuing ownership or operational involvement. The Company filed a motion to dismisson September 14, 2010 and was granted summary judgment on a majority of the claims on July 5, 2011. OnOctober 24, 2011, the plaintiffs filed a stipulation for dismissal of the Company and the Court entered an Orderon October 25, 2011 dismissing the matter against the Company with prejudice. Under the sale agreement withSeverstal, we must indemnify Severstal if it spends over $45 million on certain environmental matters. At thecurrent time, we cannot estimate the amount of potential liability, if any, which may arise from this matter.

On September 17, 2010, a complaint was filed by SPS Limited Partnership, LLP and SPS 35, LLC, theneighboring shipyard owners to the adjacent Sparrows Point steel plant. The complaint was filed in the USDistrict Court of Maryland against Severstal Sparrows Point LLC and the Company for ComprehensiveEnvironmental Response, Compensation and Liability Act (CERCLA) cost recovery, declaratory judgment,RCRA imminent and substantial endangerment, negligence, trespass, nuisance and strict liability. The claim isbased upon benzene contamination which SPS alleges is migrating onto its property from the steel plant. TheComplaint includes a demand for a jury trial. As in the preceding matter, OAO Severstal purchased all of theCompany’s interest in ISG Sparrows Point Steel LLC, its steelmaking operations and real estate. As a result ofthat sale a Severstal owned entity became fully responsible for the operation of the Sparrows Point plant. TheCompany has no continuing ownership or operational involvement with the Sparrows Point facility. TheCompany filed a motion to dismiss on November 29, 2010 and was granted summary judgment on a majority ofthe claims on July 5, 2011 and filed its answer on August 2, 2011. On October 5, 2011, the Court entered abriefing schedule. Under the sale agreement with Severstal, we must indemnify Severstal if it spends over$45 million on certain environmental matters. At the current time, we cannot estimate the amount of potentialliability, if any, which may arise from this matter.

On April 8, 2011, ArcelorMittal and Cliffs Natural Resources Inc. (Cliffs) announced the companiesreached a negotiated settlement regarding all pending contract disputes related to the procurement byArcelorMittal of iron ore pellets for certain of its facilities in the U.S. As part of the settlement, Cliffs andArcelorMittal agreed to specific pricing levels for 2009 and 2010 pellet sales and related volumes. Cliffs andArcelorMittal have agreed to replace the previous pricing mechanism in one of the parties’ iron ore supplyagreements with a world market-based pricing mechanism in which the pellet price is indexed to the Plattspublished price for iron ore fines on a quarterly basis. The new pricing mechanism began in 2011 and continuesthrough the remainder of the contract. The previous pricing mechanism was formula based including multiplemarket related factors, however, under certain conditions, it allowed for price re-openers which would ultimatelyapproximate market pricing in the affected years. The renegotiated contract represents approximately 15% of theCompany’s U.S. pellet requirements under normal operating conditions and 30% of its total Cliffs pelletcontracts.

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MANAGEMENT’S NARRATIVE ANALYSIS — RESULTS OF OPERATIONS

2011 Compared with 2010 Results

(Dollars and tonsin millions) 2011 2010

Change2011 vs

2010

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 12,119 $ 9,237 $ 2,882

Cost of sales, excluding depreciation and amortization . . . . . . . . . . . (11,655) (9,478) (2,177)

Selling, general, administrative and other expenses . . . . . . . . . . . . . (329) (275) (54)

Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (354) (341) (13)

Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8) — (8)

Operating loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (227) (857) 630

Interest income, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 1 15

Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (23) (13) (10)

Net income attributable to noncontrolling interests . . . . . . . . . . . . . . (1) — (1)

Net loss attributable to ArcelorMittal USA LLC . . . . . . . . . . . . . . . . (235) (869) 634

Steel shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.4 11.1 2.3

Raw steel production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.5 13.2 2.3

For 2011, the net loss attributable to ArcelorMittal USA LLC was $235 million versus a net loss of$869 million in 2010. For 2011 our operating loss was $227 million compared with an operating loss of$857 million for 2010. The decrease in the operating loss was primarily due to higher sales and operating volumecombined with higher selling prices for steel products, and lower costs for natural gas. Partially offsetting theseimprovements were corresponding increases in input costs for scrap, iron ore pellets, coke, and coking coal, inaddition to higher repair and maintenance and labor costs associated with the increase in operating volume.

Steel shipments in 2011 of 13.4 million tons increased by 2.3 million tons or 21% compared to 2010shipments of 11.1 million tons. Net sales increased by 31% during 2011 to $12,119 million compared to$9,237 million in 2010. Strengthening of the U.S. steel market resulted in an increase in the average selling priceper ton of 9% to $904 per ton in 2011 from $832 per ton in 2010.

Raw steel production in 2011 of 15.5 million tons increased by 2.3 million tons or 17% compared to 2010production of 13.2 million tons. Cost of sales, excluding depreciation and amortization, increased 23% to$11,655 million from $9,478 million in 2010. The increase was primarily the result of higher operating volumeand the related increases in repair and maintenance costs, labor and benefits, and higher input costs for rawmaterials as previously noted.

Selling, general, administrative and other expenses in 2011 were $329 million, a 20% increase comparedwith 2010. The primary cause of this change was an increase in profit sharing and legal expenses.

Depreciation and amortization expense in 2011 increased by $13 million because of higher capitalexpenditures in 2011 compared to 2010.

Interest income, net of interest expense for 2011 was higher than 2010 by $15 million mainly due torestructured related party debt which occurred in 2010, reducing interest expense in 2011.

Our cash balance at December 31, 2011 was $7 million, a decrease of $4 million from December 31, 2010.Cash generated by operating activities during 2011 was $297 million, compared to cash used by operatingactivities of $321 in 2010. The changes in operating income in 2011 compared to 2010 were driven primarily bythe improvement in net income due to increased sales prices and volume. Cash used by investing activities during

17

2011 was $293 million. This included $343 million of capital spending during the year of 2011, a 26% increaseover 2010 capital spending of $272 million. Cash used by financing activities during 2011 was $8 million.

ArcelorMittal USA is part of a larger controlled group that files U.S. federal income taxes. ArcelorMittalUSA Holdings Inc. (our parent company) has a full valuation allowance on its deferred taxes. Our policy is torecord deferred taxes at the subsidiary level based on the temporary differences and NOLs recorded on thefinancial statements of those subsidiaries. We recognize deferred tax assets to the extent that there are deferredtax liabilities recognized in the financial statements of other companies in our controlled group. The provision forincome taxes in 2011 of $23 million is primarily attributable to state taxes, a 2010 return to provision true-up,and our valuation allowance position which is calculated on a U.S. jurisdiction basis.

2010 Compared with 2009 Results

(Dollars and tonsin millions) 2010 2009

Change2010 vs

2009

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,237 $ 6,584 $ 2,653

Cost of sales, excluding depreciation and amortization . . . . . . . . . . . . (9,478) (7,567) (1,911)

Selling, general, administrative and other expenses . . . . . . . . . . . . . . (275) (243) (32)

Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (341) (365) 24

Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (25) 25

Operating loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (857) (1,616) 759

Interest expense, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 (37) 38

Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (13) (726) 713

Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (869) (2,379) 1,510

Steel shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1 8.0 3.1

Raw steel production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.2 9.0 4.2

For 2010, the net loss was $869 million versus net loss of $2,379 million in 2009. Included in the loss in2009 was an income tax provision of $726 million due to providing a full valuation allowance on our net deferredtax assets. For 2010 our operating loss was $857 million compared with an operating loss of $1,616 million for2009. The decrease in the operating loss was primarily due to higher sales and operating volume combined withhigher selling prices for steel products, and lower costs for natural gas. Partially offsetting these improvementswere corresponding increases in input costs for scrap, pellets, and coking coal, higher repair and maintenancecosts associated with the increase in operating volume, and higher labor costs.

Steel shipments in 2010 of 11.1 million tons increased by 3.1 million tons or 39% compared to 2009shipments of 8.0 million tons. Net sales increased by 40% during 2010 to $9,237 million compared to$6,584 million in 2009. The average selling price per ton increased by 1% to $832 per ton in 2010 from $823 perton in 2009.

Raw steel production in 2010 of 13.2 million tons increased by 4.2 million tons or 47% compared to 2009production of 9.0 million tons. Cost of sales, excluding depreciation and amortization, increased 25% to$9,478 million from $7,567 million in 2009. The increase was primarily the result of higher operating volumeand increases in repair and maintenance costs, input costs for raw materials, and labor and benefits.

Selling, general, administrative and other expenses in 2010 were $275 million, a 13% increase comparedwith 2009. The primary causes of this increase were stock option expense, legal fees and insurance costs.

Depreciation and amortization expense in 2010 decreased by $24 million reflecting the full depreciation ofcertain blast furnace assets.

18

Net interest expense for 2010 was lower than 2009 because of lower related party debt, partially offset byrepayments costs associated with retiring debt in 2010.

Our cash balance at December 31, 2010 was $11 million, an increase of $6 million from December 31,2009. Cash used by operating activities during 2010 was $321 million, a decrease of 11% compared to cash usedby operating activities in 2009. Cash used by investing activities during 2010 was $226 million. This included$272 million of capital spending during the year of 2010, a 42% increase over 2009 capital spending of$192 million. Cash provided by financing activities during 2010 was $553 million. This included $550 millionproceeds from ArcelorMittal USA Holdings which was used to fully repay related party debt of $423 million toArcelorMittal Finance, LLC. In line with 2009, we continued to repay debt.

ArcelorMittal USA is part of a larger controlled group that files U.S. federal income taxes. ArcelorMittalUSA Holdings Inc. (our parent company) has a full valuation allowance on its deferred taxes. Our policy is torecord deferred taxes at the subsidiary level based on the temporary differences and NOLs recorded on thefinancial statements of those subsidiaries. We recognize deferred tax assets to the extent that there are deferredtax liabilities recognized in the financial statements of other companies in our controlled group. The provision forincome taxes in 2010 of $13 million included $8 million of expense for changes in our uncertain tax positions.Provision for income taxes in 2010 included the recording of $379 million for valuation allowance and relateditems.

19

INDEPENDENT AUDITORS’ REPORT

To the Board of Directors and Member ofArcelorMittal USA LLCChicago, Illinois

We have audited the accompanying consolidated balance sheets of ArcelorMittal USA LLC and subsidiaries(the “Company”) as of December 31, 2011 and 2010, and the related consolidated statements of operations,comprehensive loss, cash flows and member equity for each of the three years in the period ended December 31,2011. These consolidated financial statements are the responsibility of the Company’s management. Ourresponsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States ofAmerica. Those standards require that we plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free of material misstatement. An audit includes consideration of internalcontrol over financial reporting as a basis for designing audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internalcontrol over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, ona test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accountingprinciples used and significant estimates made by management, as well as evaluating the overall financialstatement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financialposition of the Company at December 31, 2011 and 2010, and the results of their operations and their cash flowsfor each of the three years in the period ended December 31, 2011, in conformity with accounting principlesgenerally accepted in the United States of America.

/S/ DELOITTE & TOUCHE LLP

Chicago, Illinois

March 29, 2012

20

ARCELORMITTAL USA LLC

Consolidated Statements of Operations(Dollars in millions)

Year Ended December 31

2011 2010 2009

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 12,119 $ 9,237 $ 6,584

Costs and expenses:

Cost of sales, excluding depreciation and amortization . . . . . . . . . . . . . . . . . . . (11,655) (9,478) (7,567)

Selling, general, administrative and other expenses . . . . . . . . . . . . . . . . . . . . . (329) (275) (243)

Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (354) (341) (365)

Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8) — (25)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (12,346) (10,094) (8,200)

Operating loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (227) (857) (1,616)

Interest expense, related party . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (16) (66)

Interest and other financing expense, third party . . . . . . . . . . . . . . . . . . . . . . . . (72) (67) (52)

Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 84 81

Loss before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (211) (856) (1,653)

Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (23) (13) (726)

Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (234) (869) (2,379)

Less: Net income attributable to noncontrolling interests . . . . . . . . . . . . . . . . . (1) — —

Net loss attributable to ArcelorMittal USA LLC . . . . . . . . . . . . . . . . . . . . . . . . . . $ (235) $ (869) $(2,379)

See accompanying notes to consolidated financial statements.

21

ARCELORMITTAL USA LLC

Consolidated Statements of Comprehensive Loss(Dollars in millions)

Year Ended December 31

2011 2010 2009

Net loss attributable to ArcelorMittal USA LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . $(235) $ (869) $(2,379)

Other comprehensive income (loss):

Pension and Other Postretirement Employee Benefits:

Actuarial gains (losses) arising during the period . . . . . . . . . . . . . . . . . . . . . . . . . (802) (784) 207

Prior service cost from plan amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (25)

Amortization of losses and prior service recognized in earnings . . . . . . . . . . . . . 537 496 495

Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (69)

Net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (265) (288) 608

Derivative financial instruments designated as cash flow hedges:

Change in value during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (22) (7) (56)

Recognized in earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 11 260

Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (78)

Net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14) 4 126

Total other comprehensive income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (279) (284) 734

Comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(514) $(1,153) $(1,645)

See accompanying notes to consolidated financial statements.

22

ARCELORMITTAL USA LLC

Consolidated Balance Sheets(Dollars in millions except share and per share amounts)

December 31

2011 2010

ASSETSCurrent assets:Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7 $ 11Receivables, net of allowances of $41 in 2011 and $42 in 2010 . . . . . . . . . . . . . . . . . . . . . . . . 231 139Receivable from related companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158 357Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,133 2,086Prepaid expenses and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 57Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 53

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,576 2,703Long-term assets:Property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,948 4,739Investments in and advances to joint ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148 180Receivable from related companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,592 1,504Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 46Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 71

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,367 $ 9,243

LIABILITIES AND MEMBER EQUITYCurrent liabilities:Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,058 $ 965Payables to related companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86 167Accrued salaries, wages and benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437 411Accrued taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 49Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 411Unfavorable contracts and firm commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 84Current debt, including debt from related parties, and capital lease obligations . . . . . . . . . . . . 122 94Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 —

Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,955 2,181

Long-term liabilities:Debt and capital lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 753 583Pension and other retiree benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,788 5,075Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 27Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260 271

Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,804 5,956

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,759 8,137

Member equity:Preferred stock, $.01 par value, 100 shares authorized, 100 shares issued and outstanding,

liquidation value $90 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90 90Common stock, $.01 par value, 1,000 shares authorized, 121 shares issued and

outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,199 5,184Retained deficit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,321) (2,086)Accumulated other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,369) (2,090)

Member equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 599 1,098Noncontrolling interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 8

Total member equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 608 1,106

Total liabilities and member equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,367 $ 9,243

See accompanying notes to consolidated financial statements.

23

ARCELORMITTAL USA LLC

Consolidated Statements of Cash Flows(Dollars in millions)

Year Ended December 31

2011 2010 2009

Operating activities:Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(234) $(869) $(2,379)Adjustments to reconcile net loss to net cash provided by (used in) operating

activities:Deferred employee benefit costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 778 732 732Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 354 341 365Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 (1) 1,023Income on firm commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (33) (13) (165)Net amortization of purchased intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9) 11 2Undistributed earnings from joint ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (12) (12) 19Stock compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 26 7Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 — 25Other non-cash operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 (11) 27

Change in operating assets and liabilities:Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (91) 50 96Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (46) (466) 456Prepaid expenses and other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5) (5) 11Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 (1) 149Payables to and receivables from related companies . . . . . . . . . . . . . . . . . . . . . . . . . . 7 (333) (156)Deferred employee benefit payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (314) (280) (98)Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (250) 510 (474)

Net cash provided by (used in) operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 297 (321) (360)

Investing activities:Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (343) (272) (192)Investment in, advances to and distributions from joint ventures, net . . . . . . . . . . . . . 30 31 (1)Proceeds from repayment of related party note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 10 —Proceeds from sale of property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . 13 11 3Increase in restricted cash and other deposits, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 (6) —

Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (293) (226) (190)

Financing activities:Capital contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1,690Payments of long-term debt to related companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (423) (1,681)Proceeds of long-term debt from related companies . . . . . . . . . . . . . . . . . . . . . . . . . . — 550 300Payments of note payable and long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (79) (20) (15)Decrease in note receivable from related companies, net . . . . . . . . . . . . . . . . . . . . . . 67 341 252Payable to banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 105 (4)

Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8) 553 542

Net change in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4) 6 (8)Cash and cash equivalents — beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 5 13

Cash and cash equivalents — end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7 $ 11 $ 5

Supplemental disclosures of noncash operating and financing activities:Capital contribution of debt from parent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — $ 850 —Balance of payables for capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 85 66 $ 35Capital lease obligation incurred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 232 1 —Cash paid during the year for:

Interest (net of amount capitalized) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 43 $ 104 $ 156Income taxes paid (received), net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (21) (267) 3

See accompanying notes to consolidated financial statements.

24

ARCELORMITTAL USA LLC

Consolidated Statements of Member Equity(Dollars in millions)

PreferredStock

AdditionalPaid-InCapital

RetainedEarnings(Deficit)

AccumulatedOther

ComprehensiveLoss

Non ControllingInterest

TotalMemberEquity

Balance at December 31, 2008 . . . . . . $90 $2,618 $ 1,162 $(2,540) $— $ 1,330

Capital contribution by parent . . . . . . — 1,683 — — — 1,683

Contribution by noncontrollingpartner upon formation of jointventure . . . . . . . . . . . . . . . . . . . . . . . — — — — 8 8

Net loss . . . . . . . . . . . . . . . . . . . . . . . . — — (2,379) — — (2,379)

Other comprehensive income . . . . . . . — — — 734 — 734

Stock options . . . . . . . . . . . . . . . . . . . . — 7 — — — 7

Balance at December 31, 2009 . . . . . . 90 4,308 (1,217) (1,806) 8 1,383

Capital contribution by parent . . . . . . — 850 — — — 850

Net loss . . . . . . . . . . . . . . . . . . . . . . . . — — (869) — — (869)

Other comprehensive loss . . . . . . . . . . — — — (284) — (284)

Stock options . . . . . . . . . . . . . . . . . . . . — 26 — — — 26

Balance at December 31, 2010 . . . . . . 90 5,184 (2,086) (2,090) 8 1,106

Net loss attributable to ArcelorMittalUSA LLC . . . . . . . . . . . . . . . . . . . . — — (235) — — (235)

Net income attributable tononcontrolling interests . . . . . . . . . . — — — — 1 1

Other comprehensive loss . . . . . . . . . . — — — (279) — (279)

Stock options . . . . . . . . . . . . . . . . . . . . — 18 — — — 18

Taxes related to stock options . . . . . . . — (3) — — — (3)

Balance at December 31, 2011 . . . . . . $90 $5,199 $(2,321) $(2,369) $ 9 $ 608

See accompanying notes to consolidated financial statements.

25

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(1) Nature of Business, Basis of Presentation and Consolidation

(a) Reporting Entity

ArcelorMittal USA LLC, or ArcelorMittal USA, or the Company, is one of the largest steelmakers inNorth America and serves a broad U.S. manufacturing base. ArcelorMittal USA is an indirect wholly ownedsubsidiary of ArcelorMittal S.A. (ArcelorMittal) and a direct subsidiary of ArcelorMittal Holding Company,LLC and 3222193 Nova Scotia Company. The Company had formerly been known as ArcelorMittal USA Inc.As of December 21, 2010 ArcelorMittal USA Inc. converted to a Limited Liability Company and changed itsname to ArcelorMittal USA LLC.

(b) Basis of Presentation

These consolidated financial statements include the accounts of the Company and its consolidatedsubsidiaries. Additionally, variable interest entities for which we are the primary beneficiary are included in theconsolidated financial statements and their impacts are partially offset by a noncontrolling interest. Allintercompany accounts and transactions have been eliminated in consolidation. Investments in joint ventures areaccounted for under the equity method of accounting except Hibbing Taconite, which is proportionallyconsolidated, and Burns Harbor Fuels, which is consolidated with an associated noncontrolling interest, andEmpire Iron Mines, which is accounted for at cost less impairment.

We have evaluated subsequent events through March 29, 2012. We have concluded that no material eventsor transactions took place through this date.

(c) Nature of Business

ArcelorMittal USA is a domestic manufacturer of light flat-rolled, plate, wire rod and rail steel productswhose customers are located primarily in the United States. It was formed by the merger of International SteelGroup Inc. (ISG) and Ispat Inland Inc. (Inland). ISG was formed by a series of acquisitions that brought togetherthe steel producing assets of The LTV Corporation (LTV), Acme Steel Corporation (Acme), Bethlehem SteelCorporation (Bethlehem), Weirton Steel Corporation (Weirton), and Georgetown Steel Company (Georgetown).We report our activities in two segments (See Note 3, Segment Information) and primarily serve the automotive,appliance, transportation, machinery and construction markets, either directly or through steel service centers. Nosingle customer represented more than 10% of our total consolidated revenues. Export sales were $729 in 2011,$561 in 2010, and $499 for 2009. Shipments by product follow:

2011 2010 2009

Hot Rolled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38% 37% 28%

Cold Rolled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22% 25% 28%

Coated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17% 18% 18%

Plate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11% 10% 11%

Tin Plate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3% 4% 5%

Bars, Rail and Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9% 6% 10%

100% 100% 100%

26

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(2) Summary of Significant Accounting Policies

(a) Revenue Recognition

Revenue is recognized at the time products are shipped in accordance with customer instructions and whenall substantial risks of ownership are transferred to the customer. ArcelorMittal USA provides a full allowancefor estimated claims for products that have been shipped that may not meet customer specifications. Wegenerally test our steel products before shipment to provide assurance that they meet customer specifications.Our sales agreements do not contain “acceptance” or “right of return” clauses. The allowance is calculated basedon claims that have been submitted but not resolved and anticipated future claims based on historical experience.

The allowance for claims is a component of the accounts receivable allowances disclosed on the balancesheet and the provision for claims is a component of net sales.

(b) Stock Based Compensation

New Restricted Share Unit Plans

At the ArcelorMittal annual shareholders’ meeting on May 10, 2011, a new equity-based incentive plan wasapproved to replace the Global Stock Option Plan. The new plan comprises a Restricted Share Unit Plan (RSUPlan) and a Performance Share Unit Plan (PSU Plan) designed to incentivize the targeted employees, to improvethe long-term performance of the Company and to retain key employees. Both the RSU Plan and the PSU Planare intended to promote the alignment of interests between the Company’s shareholders and eligible employeesby allowing them to participate in the success of the Company.

The Global Stock Option Plan

In 1999, Mittal established the Global Stock Option Plan with a duration of ten years. As the initial planreached expiration, a new plan was adopted. Awards under the plan vest over three years. We measure the cost ofall employee share-based payments to employees, including grants of employee stock options, using a fair-value-based method. Compensation costs for the plans have been determined based on the fair value at the grant dateusing the Black-Scholes option pricing model and amortized on a straight-line basis over the respective vestingperiod representing the requisite service period. Options granted prior to January 1, 2003 are accounted for underthe intrinsic model permitted in the transitional provisions in the U.S. accounting rules.

These are described more fully in Note 10, Stock Based Compensation.

(c) Research and Development Costs

Research and development costs are expensed as incurred. Total research and development costs were $64in 2011, $58 in 2010, and $50 in 2009.

(d) Income Taxes

ArcelorMittal USA is part of a larger controlled group that files U.S. federal income taxes. Income taxes areaccounted for under the asset and liability method that requires deferred income taxes to reflect the future taxconsequences attributable to differences between the tax and financial reporting bases of assets and liabilities.Deferred tax assets and liabilities recognized are based on the tax rates in effect in the year in which differencesare expected to reverse. Deferred tax assets are reduced by a valuation allowance when, based on availablepositive and negative evidence, it is “more likely than not” (greater than a 50% likelihood) that some or all of thenet deferred tax assets will not be realized.

27

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Our income tax returns are subject to audit by the Internal Revenue Service (IRS) and state tax authorities.The amounts recorded for income taxes reflect our tax positions based on research and interpretations of complexlaws and regulations. We accrue liabilities related to uncertain tax positions taken or expected to be taken in a taxreturn. Interest on these liabilities is classified as interest expense and penalties are reflected in operatingexpenses.

We follow ASC 740 Income Taxes which prescribes a recognition threshold and measurement process forrecording in the financial statements uncertain tax positions taken or expected to be taken in a tax return.Additionally, it provides guidance on the derecognition, classification, accounting in interim periods anddisclosure requirements for uncertain tax positions.

(e) Cash and Cash Equivalents

Cash and cash equivalents consist of highly liquid instruments with an original maturity of three months orless and are carried at cost, which approximates market value.

(f) Receivables

We are participants in a one year renewable factoring agreement with a financial institution under whichthey are entitled to buy eligible accounts receivables from customers up to a shared maximum amount of $900between the Company and two related parties. The financial institution buys these receivables without recourseto the seller. Accordingly when sold, the receivables are removed from our books. Loss on sales of receivableshas been included on the Consolidated Statements of Operations on line Interest and other financing expense,third party for the years of 2011 and 2010 and on line Selling, general, administrative and other expenses for2009.

2011 2010 2009

Nominal amount of receivables sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,691 $5,177 $3,001

Proceeds from sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,673 5,164 2,990

Loss on sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 13 11

Amount outstanding under the arrangement at year-end . . . . . . . . . . . . . 773 564 378

(g) Inventories

Inventories are stated at the lower of cost or market, which approximates replacement cost. Inventories arevalued using the Last In First Out (LIFO) method. Costs include the purchase costs of raw materials, conversioncosts, and an allocation of fixed and variable production overhead. The components of inventories follow:

December 31

2011 2010

First In First Out (FIFO) or average cost:

Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,320 $1,310

Finished and semi-finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,893 1,526

3,213 2,836

LIFO reserve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,080) (750)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,133 $2,086

28

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

There was no liquidation of LIFO inventory in 2011 or 2010. Liquidation of LIFO inventory reduced cost ofsales by $150 in 2009.

(h) Assets Held for Sale

Assets that are not being operated and expected to be sold within one year are recorded as assets held forsale at the lower of the carrying value or fair value, less costs to sell. These assets are not depreciated whileclassified as held for sale. Assets held for sale and the associated liabilities, if any, are included in the currentasset and liabilities section of our balance sheet. At December 31, 2011 and 2010 there are no assets held for sale.

(i) Property, Plant and Equipment

Property, plant and equipment are stated at cost. Depreciation is generally provided on a straight-line basisover the estimated useful lives of the assets. The estimated useful lives range from 3 to 30 years for machineryand equipment and 40 years for buildings. Repairs and maintenance that do not significantly improve or extendthe lives of the respective assets are expensed as incurred throughout the year. Property, plant and equipmentunder construction are recorded as construction in progress until they are ready for their intended use; thereafterthey are transferred to the related category of property, plant and equipment and depreciated over their estimateduseful lives. We record capitalized interest when those amounts are material. Generally we do so on projects thatexceed $10 and that are expected to take more than one year to complete. The interest rate is a weighted averageof the cost of debt.

The components of property, plant and equipment, net follow:

December 31

2011 2010

Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 249 $ 247

Buildings, mineral reserves and land improvements . . . . . . . . . . . . . . . . . . . . . . . 575 570

Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,614 6,142

Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 287 265

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,725 7,224

Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,777) (2,485)

Total property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,948 $ 4,739

(j) Long-lived Assets and Goodwill

Long-lived assets are subject to an impairment assessment if there are circumstances or triggers that indicatethe carrying amount may no longer be recoverable from future operations or sale. The amount of the impairmentrecognized, if any, is the difference between the carrying amount and the fair value of the asset. We test goodwillat least annually for impairment at November 30 at the reporting unit level. Our reporting units are our segments.All goodwill relates to the flat segment. We compare the fair value of the reporting unit with its carrying amount,including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reportingunit is not considered impaired. If the carrying value exceeds the fair value of the reporting unit, then we

29

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

determine the implied fair value of goodwill. If the carrying value of the goodwill exceeds the implied fair valueof the goodwill, we would recognize an impairment equal to that excess. There were no impairments to goodwill.We have recorded goodwill of $71 related to the acquisition of ISG as of December 31, 2011 and December 31,2010.

(k) Intangible Assets

At December 31, 2011 intangible assets consist of patents of $4 (accumulated amortization of $2). Alsorecorded at December 31, 2011 are liabilities for unfavorable supply contracts of $5. The amounts for the supplycontracts are being amortized over the term of the associated contracts. We recognized income of $9 in 2011,expense of $10 in 2010, and expense of $2 in 2009 related to the net amortization of both favorable andunfavorable contracts. The net aggregate estimated amortization income for each of the next five years follows.

2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2

2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —

2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —

(l) Contingencies

Liabilities for loss contingencies, including environmental remediation costs, arising from claims,assessments, litigation, fines and penalties and other sources are recorded when it is probable that a loss has beenincurred and the amount can be reasonably estimated.

Our estimates of environmental remediation liabilities are based on current technology and existing lawsand regulations and site-specific estimated costs developed by management with the assistance of independentengineering consultants. The expected future environmental remediation costs and asset retirement obligationsacquired in a business combination were recorded at present value amounts determined at appropriate currentinterest rates at the time of the acquisition. We determined that rate to be the risk free rate (not credit-adjusted).While the accounting rules for business combinations require that the liabilities be discounted, the environmentalliabilities that were not recognized in a business combination can only be discounted if the amount and timing ofcash payments are fixed or reliably determinable. Since the timing of spending depends on many factors (seeNote 15, Environmental Matters and Asset Retirement Obligations) we have not discounted these liabilities. Wehave also recorded asset retirement obligations for the removal of asbestos, the closure of our iron ore miningproperties and landfills. We discount these liabilities using a credit-adjusted risk free rate.

(m) Derivative Financial Instruments

We are exposed to fluctuations in interest rates and the prices of certain commodities such as natural gas,fuel oil, coke, steel scrap, iron ore and various non-ferrous metals. Management is authorized to use variousfinancial instruments where available to manage the exposures associated with these fluctuations. We mayemploy futures, forwards, collars, options and swaps to manage certain exposures when practical. By policy, wedo not enter into such contracts for the purpose of speculation. All derivatives, whether designated in hedgingrelationships or not, are recorded on the balance sheet at fair value, or the company elects to treat certainderivatives as Normal Purchase or Normal Sales transactions. Our policy is to offset fair value amounts

30

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

recognized for similar commodity derivative instrument contracts with the same counterparty. At the inception ofa hedge relationship, we formally designate and document the hedge relationship to which we wish to applyhedge accounting and the risk management objective and strategy for undertaking the hedge. The documentationincludes identification of the hedge instrument, the hedged transaction, the nature of the risk being hedged andhow we will assess the hedging instrument’s effectiveness in offsetting the exposure to changes in the hedgeditem’s cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achievingoffsetting changes in cash flows and are assessed on an ongoing basis to determine that they actually have beenhighly effective through the financial reporting periods for which they were designated. If the derivative isdesignated as a cash flow hedge, changes in the fair value of the derivative are recorded in equity and arerecognized in cost of sales in the consolidated statement of operations when the hedged transaction affectsearnings. Ineffective portions of changes in the fair value of cash flow hedges are recognized in cost of sales. Inaddition, the fair value gains or losses as a result of the change in fair value of derivatives that do not qualify forhedge accounting are recognized immediately in cost of sales.

(n) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in theUnited States of America requires that management make estimates and assumptions that affect the amountsreported in the financial statements and accompanying notes. Actual results could differ from these estimates.

(o) Recent Accounting Pronouncements

ASU 2010-06 — The FASB issued ASU 2010-06 Fair Value Measurement and Disclosures (Topic 820):Improving Disclosures about Fair Value Measurements. This guidance requires new disclosures related totransfers into and out of Level 1 and 2 inputs and separate disclosures about purchases, sales, issuances, andsettlements relating to Level 3 measurements. The new requirements clarify existing fair value disclosures aboutthe level of disaggregation and about inputs and valuation techniques used to measure fair value. Theserequirements were effective for us in 2010, except for the requirement to provide Level 3 activity of purchase,sales, issuance, and settlements on a gross basis, which were effective in 2011. The adoption of theserequirements did not materially affect our disclosures.

ASU 2011-04 — The FASB issued ASU 2011-04 Fair Value Measurement (Topic 820): Amendments toAchieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. This guidanceprovides common requirements for measuring fair value and disclosing information about fair valuemeasurements in accordance with U.S. GAAP and IFRS. This ASU is effective for us in 2012. The adoption ofthis guidance on January 1, 2012 is not expected to have a material impact on our consolidated financialstatements.

ASU 2011-06 — The FASB issued ASU 2011-06, Comprehensive Income (Topic 820). This accountingstandard update eliminates the option to present components of other comprehensive income as part of thestatement of equity and requires that the total of comprehensive income, the components of net income, and thecomponents of other comprehensive income be presented either in a single continuous statement ofcomprehensive income or in two separate but consecutive statements. It also requires presentation on the face ofthe financial statements of reclassification adjustments for items that are reclassified from other comprehensiveincome to net income in the statement(s) where the components of net income and the components of othercomprehensive income are presented. We have modified the presentation of our consolidated financial statementsto comply with the standard update in this document.

31

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

ASU 2011-08 — The FASB issued ASU 2011-08, Intangibles-Goodwill and Other (Topic 350) TestingGoodwill for Impairment. This update revises the accounting standards with the intent of simplifying how anentity tests goodwill for impairment. The amendment allows an entity to first assess qualitative factors todetermine whether it is necessary to perform the two-step quantitative goodwill impairment test. We will nolonger be required to calculate the fair value of a reporting unit unless we determine, based on a qualitativeassessment, that it is more likely than not that its fair value is less than its carrying amount. We do not expect thisstandard to have a material impact on our consolidated financial statements.

ASU 2011-09 — The FASB issued ASU 2011-09, Disclosures about an Employer’s Participation in aMulti-Employer Plan. This guidance requires additional disclosures about employer’s participation in multi-employer pension plans. This ASU was effective for us in 2011. See Note 11 — Pension and OtherPostretirement Benefit Plans.

ASU 2011-11 — The FASB issued ASU 2011-11, Balance Sheet (Topic 210): Disclosures about OffsettingAssets and Liabilities. This guidance requires entities to disclose both gross and net information about bothinstruments and transactions eligible for offset in the statement of financial position and instruments andtransactions subject to an agreement similar to a master netting agreement. The objective of the disclosure is tofacilitate comparison between those entities that prepare their financial statements on the basis of U.S. GAAPand those entities that prepare their financial statements on the basis of International Financial ReportingStandards (IFRS). This ASU is effective for us in 2013. Retrospective presentation for all comparative periodspresented is required. The adoption of this guidance is not expected to have a material impact on ourconsolidated financial statements.

(3) Segment Information

We report our operations in two operating segments: Flat Carbon USA and Long Carbon USA. Flat CarbonUSA produces slabs, hot-rolled coil, cold-rolled coil, coated steel, and plate. These products are sold primarily tocustomers in the distribution and processing, automotive, pipe and tube, construction, packaging, and appliancesindustries. Long Carbon USA production consists of sections, wire rod, rebar, billets, blooms, and wire drawing.The accounting principles applied at the operating level in determining income or loss from operations aregenerally the same as those applied at the consolidated financial statement level. All intersegment sales arepriced at market and are eliminated in consolidation. Corporate level selling, general and administrative expensesand costs are allocated to the reportable segments based on measures of activity that management believes arereasonable. Financial data relating to our continuing operations by business segment follow.

2011 Flat Long Eliminations Total

Net sales to external customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,979 $1,140 $ — $12,119Net sales to other segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 8 (19) —Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 6 — 88Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (68) (4) — (72)Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (305) (49) — (354)Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (21) (2) — (23)Net loss attributable to ArcelorMittal USA LLC . . . . . . . . . . . . . . . . . (213) (22) — (235)Non cash item — income from firm commitments . . . . . . . . . . . . . . . 33 — — 33Amortization of purchased intangibles . . . . . . . . . . . . . . . . . . . . . . . . . 8 1 — 9Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,825 542 — 9,367Investments in and advances to joint ventures . . . . . . . . . . . . . . . . . . . 148 — — 148Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (315) (28) — (343)

32

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

2010 Flat Long Eliminations Total

Net sales to external customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $8,657 $580 $ — $9,237Net sales to other segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 4 (13) —Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 7 — 84Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (75) (8) — (83)Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (322) (19) — (341)Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (12) (1) — (13)Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (771) (98) — (869)Non cash item — income from firm commitments . . . . . . . . . . . . . . . . . . . 13 — — 13Amortization of purchased intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10) (1) — (11)Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,746 497 — 9,243Investments in and advances to joint ventures . . . . . . . . . . . . . . . . . . . . . . . 180 — — 180Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (249) (23) — (272)

2009 Flat Long Eliminations Total

Net sales to external customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,064 $ 520 $ — $ 6,584

Net sales to other segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 2 (20) —

Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 7 — 81

Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (108) (10) — (118)

Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (338) (27) — (365)

Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (664) (62) — (726)

Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,166) (213) — (2,379)

Non cash item — income from firm commitments . . . . . . . . . . . . . . . . . 165 — — 165

Amortization of purchased intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . (2) — — (2)

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,814 553 — 9,367

Investments in and advances to joint ventures . . . . . . . . . . . . . . . . . . . . 212 — — 212

Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (184) (8) — (192)

(4) Impairment Losses

In 2009 we recognized a total impairment loss of $25 comprised of $5 for Lackawanna and $20 million forGeorgetown. The Lackawanna facility was closed in 2008 and an impairment loss of $23 had been previouslyrecognized. As we completed the shutdown and began disposal of the assets, the amounts realized were less thanpreviously estimated. We recognized an additional impairment of $5 to write down the assets to the amountsexpected to be realized. The remaining Lackawanna assets were sold in 2010. In 2009 we temporarily idled ourGeorgetown facility and it remained idle throughout 2010. The future cash flows forecasted for this facility werenot sufficient to recover its carrying value. The fair value of the assets was determined based on the salvage valueof the individual assets. In 2010, we modified the labor agreement to make the facility more competitive.Production and shipments resumed at Georgetown in early 2011.

We recognized $8 of impairment losses in 2011 related to slag processing equipment held under a capitallease by our Burns Harbor facility. The present value of the capital lease payments related to this equipment was$10, and we recorded impairment charges to write down the assets to their fair value of $2.

33

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

The impairment loss for Georgetown relates to the long segment. All other losses relate to the flat segment.As we no longer expected to recover the carrying value of the assets described above, we used the fair valuesdescribed above to calculate the amount of the impairment loss. Each valuation had significant unobservableinputs, described as Level 3 in the accounting literature. See Note 8 Derivative Instruments and Hedging Activityfor a description of the three-level fair value hierarchy. Sales of used steel production equipment occurinfrequently, prices depend on a particular asset’s condition and whether it is compatible with a potential buyer’sexisting equipment. We consulted with internal engineering personnel who had knowledge of our equipment andwhat we would probably realize from its sale or by using the metal content as scrap to develop these values.

(5) Joint Ventures

NameOwnershipPercentage Description

Double G Coatings 50.0% Operates a 270,000 ton capacity sheet coating line producinggalvanized and Galvalume.

Hibbing Taconite 62.3% Operates mine and pelletizing plant.

Empire Iron Mining 21.0% Operates mine and pelletizing plant.

I/N Kote 50.0% Operates a 1.0 million ton capacity steel galvanizing facility.

I/N Tek 60.0% Operates a 1.7 million ton capacity cold-rolling mill.

PCI Associates 50.0% Operates a pulverized coal injection facility.

Steel Construction Systems 45.0% Manufactures steel studs and roll-formed trusses for residentialand light commercial buildings.

Steel Health Resources 47.5% Owns the building of a healthcare clinic.

Burns Harbor Fuels 49.0% Recycles coke oven waste products.

Zug Island Fuels 51.0% Recycles coke oven waste products.

Neville Island Fuels 51.0% Recycles coke oven waste products.

In 2009 we entered into three joint ventures, all with the same partner. These joint ventures produce steelindustries fuel by spraying tar decanter sludge and wash oil residue onto coal which is then consumed in a cokeoven. The process eliminates the waste material and generated tax credits in 2009 and 2010. One of these jointventures, Burns Harbor Fuels, is located adjacent to our coke oven at Burns Harbor. The other two joint ventures,Zug Island Fuels and Neville Island Fuels, are located adjacent to coke ovens owned by our partner. Normallythe determination as to whether an entity should be consolidated is based on who has the majority of the votinginterests. In some cases, control of an entity is obtained through other contractual arrangements. Such entities arereferred to as variable interest entities (VIEs). We determined that all three joint ventures are VIEs and that ineach case the minority partner was the primary beneficiary. This is because the minority partner controlled andoperated the joint venture, received all of its output, and had the majority of any expected losses or residualreturns. As a result, we consolidate Burns Harbor Fuels and account for Zug Island Fuels and Neville IslandFuels under the equity method.

Burns Harbor Fuels has assets of $71, which are principally inventory, a trade receivable with ArcelorMittalUSA, and property, plant & equipment. It has liabilities of $53, all of which are loans from ArcelorMittal USAthat are eliminated in consolidation. Our total investment of $10 in Zug Island Fuels and Neville Island Fuels isrecorded in Investments in and advances to joint ventures on our consolidated balance sheet. Our maximumexposure to loss is the amount of our investment.

34

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

We account for our other joint ventures under the equity method except for Hibbing Taconite and EmpireIron Mining. Because we own an undivided interest in each asset and are liable for our share of each liability, weproportionally consolidate Hibbing Taconite. We account for Empire Iron Mining under the cost method as wedo not exert significant influence over this entity. Our investment in Empire Iron Mining was impaired and wehave reduced its carrying value to zero. We do not exercise control over I/N Tek, as all significant managementdecisions of the joint venture require agreement by both of the partners. Due to this lack of control, we accountfor our investment in I/N Tek under the equity method.

The carrying amount of our joint ventures is $4 higher than the amount of underlying equity. We amortizethis difference over the estimated life of the joint ventures. Most of these joint ventures provide services to ouroperations. They bill for these services at cost or some other contractual rate that may not reflect the market ratefor these services. We recorded income of $39 in 2011, income of $37 in 2010, and a loss of $5 in 2009 for ourshare of earnings in the joint ventures as an impact to cost of sales.

A summary of combined financial information for joint ventures accounted for under the equity methodfollows:

2011 2010 2009

Results for the year:

Gross revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,212 $1,023 $654

Costs and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,136 951 646

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 76 $ 72 $ 8

Financial position at December 31:

Current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 407 $ 420 $139

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703 747 531

Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160 304 91

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 522 470 211

Net assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 181 277 320

35

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(6) Debt and Capital Lease ObligationsDecember 31

2011 2010

Senior Unsecured Notes, 6.50%, due April 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $500 $500Coke oven battery, variable, due May 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 72Burns Harbor slag loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 —MABCO note, 5.00%, due May 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 3

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 565 575

Industrial Development Revenue Bonds:Exempt Facilities Project No. 14, 6.70% due November 2012 . . . . . . . . . . . . . . . . . . . 5 5Exempt Facilities Project No. 15, 5.75% due October 2011 . . . . . . . . . . . . . . . . . . . . . — 51Exempt Facilities Project No. 16, 7.00% due January 2014 . . . . . . . . . . . . . . . . . . . . . . 8 8

Total industrial development revenue bonds . . . . . . . . . . . . . . . . . . . . . . . . . 13 64

Capital Lease Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230 15

Total third party debt and capital lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 808 654Current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (55) (71)

Long-term portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $753 $583

Related Party Debt:Notes from related parties — classified as current . . . . . . . . . . . . . . . . . . . . . . . . . $ 67 $ 23

(a) Maturities

The maturities of debt and required capital lease payments (including related party debt) at December 31,2011 follow:

2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $122

2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 543

2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $875

(b) Senior Unsecured Notes

These senior, unsecured debt securities are due 2014. The debt securities bear interest at a rate of 6.5%.ArcelorMittal S.A. and most wholly owned subsidiaries of ArcelorMittal USA fully and unconditionallyguarantee these notes.

(c) Coke Oven Battery Installment Purchase

In May 2005, we took ownership of a coke oven battery at Burns Harbor that was previously leased under acapital lease. Payments to the lender are minimum monthly payments totaling $6 per year with additionalpayments based on coke production through 2015. The coke oven battery is collateral for the loan.

36

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(d) MABCO Note

The note, maturing May 2019, bears interest at 5.0% per annum with annual principal and interestpayments.

(e) Industrial Development Revenue Bonds

These loans relate to fixed rate, unsecured industrial development revenue bonds bearing interest at 6.70%to 7.00%. In October 2011, we redeemed $51 for the Exempt Facilities Project No. 15 bond, which carried aninterest rate of 5.75%, as scheduled.

(f) Capital Lease Obligations

In 2011 we modified a long-term take or pay contract to take the output of an off-site coke oven batterythrough 2020. We determined that a substantial portion of the fixed payments related to the use of the underlyingcoke oven assets. Accordingly, we recognized a capital lease obligation of $180 based on an implicit interest rateof 7.7%.

Also in 2011 we modified a contract related to an on-site turbine generator and cooling tower that generateselectricity from steam generated by Indiana Harbor East. Under the agreement we make tolling payments basedon the amount of electricity generated. However, if the volumes drop below certain levels, the rates we payincrease in the future, effectively establishing minimum payments. This agreement continues for the remainingeconomic life of the asset. Accordingly, we recognized a capital lease obligation of $41 related to the use of thisasset.

Our capital lease obligations also include various leased machinery and equipment including that related toscrap handling facilities at Burns Harbor and Steelton, and mobile equipment.

(g) Related Party Debt — Senior Secured Debt

The remaining Senior Secured Series Z debt owed to ArcelorMittal Finance, LLC of $423 was prepaid onApril 1, 2010, paying a 103.25% redemption price. This was financed through a loan from a related party. Wepaid interest on the Series Z Senior Secured Notes at a rate of 10.75% through April 1, 2010 and were alsocharged $20 by ArcelorMittal Finance LLC for the unamortized financing fees and expenses allocable to theportion of the prepaid debt, which is disclosed on our Consolidated Statement of Operations within the Interestexpense, related party line item. The notes were secured by a First Mortgage on a substantial portion of theproperty, plant and equipment at our Indiana Harbor East facility. With this prepayment, the First Mortgage wasterminated.

(h) Related Party Debt — ArcelorMittal USA Holdings Term Notes

In December 2009 we entered into an agreement with ArcelorMittal USA Holdings to borrow $300. Thearrangement pays ArcelorMittal USA Holdings three annual interest payments at 0.69% interest from 2010 to2012. The principal payment of $300 is due on December 27, 2012. In February 2010 we borrowed an additional$100 at 0.72% and in April 2010 we borrowed an additional $450 at 0.67% with similar terms as the December,2009 Note. In December, 2010 the three Notes totaling $850 were converted to capital.

37

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(i) Other Information

Interest costs incurred totaled $77 in 2011, $70 in 2010, and $118 in 2009, of which $5, $3 and $1 arecapitalized, respectively.

Based on quoted market values, the borrowing rates currently available to us, and other availableinformation, the fair market value of debt and capital leases is $925 at December 31, 2011 and $715 atDecember 31, 2010.

The net book value of assets under capital leases was $223 at December 31, 2011 and $18 at December 31,2010.

At December 31, 2011 and December 31, 2010 we were in compliance with all debt covenants.

(7) Related Party Balances and Transactions

December 31

2011 2010

Current receivables:

Short term loan payable with ArcelorMittal Treasury . . . . . . . . . . . . . . . . . . . . . . . $ — $ (3)

Trade and interest receivables with ArcelorMittal subsidiaries . . . . . . . . . . . . . . . . 144 289

Receivable with I/N Tek . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 8

Receivable with I/N Kote . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 63

Current receivable from related companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 158 $ 357

Long-term receivables:

Loan with ArcelorMittal Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,592 $1,504

Current payables:

Trade payables with ArcelorMittal subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 79 $ 152

Payable with I/N Tek . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 4

Payable with I/N Kote . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 11

Payables to related companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 86 $ 167

2011 2010 2009

Interest expense to Mittal Steel US Finance LLC . . . . . . . . . . . . . . . . . . . . . . . $ — $ 5 $ 21

Interest expense to ArcelorMittal Finance Services LLC . . . . . . . . . . . . . . . . . — 11 45

Interest income on notes receivable from related companies . . . . . . . . . . . . . . 87 83 80

ArcelorMittal charges for management, financial and legal services . . . . . . . . 21 15 18

ArcelorMittal research and development management fees . . . . . . . . . . . . . . . 33 27 25

ArcelorMittal USA purchases of inventory from subsidiaries ofArcelorMittal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179 99 25

ArcelorMittal USA sales of inventory to subsidiaries of ArcelorMittal . . . . . . 491 591 463

Sales to I/N Kote . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 421 398 351

Tolling with I/N Tek . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154 150 84

38

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

See Note 6, Debt and Capital Lease Obligations, for a discussion of related party debt. Our I/N Kote jointventure is required to buy all of its cold rolled steel from ArcelorMittal USA. We also have rights to theproductive capacity of the I/N Tek facility, except in certain limited circumstances and, under a tollingarrangement, have an obligation to use the facility for the production of cold rolled steel.

ArcelorMittal USA participates in a cash pooling arrangement with ArcelorMittal Treasury. Available cashfrom several companies within the ArcelorMittal group is concentrated globally to maximize interest returns.Cash is transferred to and from the pooling account based on local availability and requirements.

The Company agreed to an extension of its loan to its direct parent, ArcelorMittal Holdings LLC, duringApril 2010.

(8) Derivative Instruments and Hedging Activity

In connection with the purchasing of natural gas and certain metals, primarily zinc, for anticipatedmanufacturing requirements, we enter into forward swap contracts for these commodities to reduce the effect ofprice fluctuations. We do not hold derivative instruments for trading purposes. We have elected to account forthese forward swap contracts as cash flow hedges. Accounting rules require that we recognize all derivativeinstruments at fair value and provide that the effective portion of the gain or loss on a derivative instrumentdesignated and qualifying as a cash flow hedging instrument be reported as a component of comprehensiveincome and be reclassified into earnings in the same period or periods during which the hedged transactionaffects earnings. The remaining gain or loss on the derivative instrument, if any, must be recognized currently inearnings.

The following table presents the fair value of our derivative instruments and the classification of each on theBalance Sheet as of December 31, 2011 and 2010:

Derivative Assets

2011 2010

Balance SheetLocation Fair Value

Balance SheetLocation Fair Value

Derivative instruments designated as cash flowhedges:

Base metal contracts (primarily zinc) . . . . . . . . . . . Prepaid expensesand other

$— Prepaid expensesand other

$ 3

Total derivatives designated as hedginginstruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$— $ 3

Derivative instruments not designated ashedging instruments:

Base metal contracts (primarily zinc) . . . . . . . . . . . Prepaid expensesand other

$— Prepaid expensesand other

$ 1

Other commodity contracts . . . . . . . . . . . . . . . . . . Accruedexpenses andother liabilities

1 Accruedexpenses andother liabilities

8

Total derivatives not designated as hedginginstruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 1 $ 9

Total derivative assets . . . . . . . . . . . . . . . . . . . . . . $ 1 $12

39

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Derivative Liabilities

2011 2010

Balance SheetLocation Fair Value

Balance SheetLocation Fair Value

Derivative instruments designated as cashflow hedges:

Natural gas contracts . . . . . . . . . . . . . . . . . . . . Accrued expensesand other liabilities

$ (3) Accrued expensesand other liabilities

$—

Natural gas contracts . . . . . . . . . . . . . . . . . . . . Payables to relatedcompanies

(2) Payables to relatedcompanies

(1)

Base metal contracts (primarily zinc) . . . . . . . Accrued expensesand other liabilities

(3) Accrued expensesand other liabilities

—

Base metal contracts (primarily zinc) . . . . . . . Other long-termliabilities

(2) Other long-termliabilities

—

Total derivatives designated as hedginginstruments . . . . . . . . . . . . . . . . . . . . . . . . . . $(10) $ (1)

Derivative instruments not designated ashedging instruments:

Base metal contracts (primarily zinc) . . . . . . . Accrued expensesand other liabilities

(2) Accrued expensesand other liabilities

$—

Total derivatives not designated as hedginginstruments . . . . . . . . . . . . . . . . . . . . . . . . . . $ (2) $—

Total derivative liabilities . . . . . . . . . . . . . . . . $(12) $ (1)

The effect of derivative instruments on the consolidated statement of operations for the years 2011 and 2010follows:

Amount of Gain or(Loss) Recognized

in OCI onDerivative

(Effective Portion)

Location of Gain or(Loss) Reclassified

from AOCI intoIncome (Effective

Portion)

Amount of Gain or(Loss) Reclassified

from AOCI intoIncome (Effective

Portion)

Location of Gain or(Loss) Recognized

in Income onDerivative

(Ineffective Portionand Amount

Excluded fromEffectiveness Testing)

Amount of Gain or(Loss) Recognized

in Income onDerivative

(Ineffective Portionand Amount

Excluded fromEffectiveness

Testing)*

2011 2010 2009 2011 2010 2009 2011 2010 2009

Derivatives Designatedin Cash FlowHedgingRelationships:

Natural gas contracts . . . $ (9) $(6) $(67) Cost of Sales $(3) $(10)$(252) Cost of Sales $— $— $ 1Base metal contracts . . . (13) (1) 11 Cost of Sales (5) (1) (9) Cost of Sales — — —

Total . . . . . . . . . . . . . . . $(22) $(7) $ 56 $(8) $(11)$(261) $— $— $ 1

* Any amount of gain/loss recognized in income is due entirely to the ineffective portion of the hedgingrelationship. No amounts were excluded from the assessment of hedge effectiveness.

40

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Location of Gain or(Loss) Recognized in

Income onDerivative

Amount of Gain or(Loss) Recognized

in Income onDerivative

2011 2010

Derivatives not designated in a hedging relationship:

Natural gas contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cost of Sales $ — $(2)

Other commodity supply contracts . . . . . . . . . . . . . . . . . . . . . . Cost of Sales (26) (6)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(26) $(8)

Outstanding notional amounts under commodity forward contracts that were entered into to hedgeforecasted purchases and are accounted for as cash flow hedges at December 31, 2011 follows:

Commodity Notional Amount

Natural gas contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,150,000 mmbtus

Base metal contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,577 metric tons

Outstanding notional amounts under derivative contracts that were not designated as hedges atDecember 31, 2011 follows:

Commodity Notional Amount

Base metal contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,651 metric tons

Commodity supply contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,638,442 net tons

In some cases, our International Swaps and Derivatives Association (ISDA) contracts contain cross defaultprovisions that could constitute a credit risk related contingent feature. These provisions apply if we default inmaking timely payments on outstanding indebtedness and the amount of the default is above certain predefinedthresholds. If an event of cross default occurs, our ISDA counterparties may have the right to request earlytermination and net settlement of any outstanding derivative liability position. At December 31, 2011, we do nothave any credit risk related to this contingent feature as all derivative contracts are with ArcelorMittal TreasurySNC, a subsidiary of our parent company.

For derivatives designated as cash flow hedges, we formally measure hedge effectiveness of our hedgingrelationships both at hedge inception and on an ongoing basis. The effective portion of derivatives gain or loss isrecorded in other comprehensive income and is recorded in cost of sales in the same period we record the hedgedraw material requirements in cost of sales. The amount of net losses on cash flow hedging derivatives expected tobe reclassified from other comprehensive income to cost of sales over the next twelve months is $9 as ofDecember 31, 2011. The maximum maturity of cash flow derivatives in place at December 31, 2011 isDecember 31, 2013.

The ineffective portion of hedges is recorded in cost of sales. We recorded zero in 2011 and in 2010 and again of $1 in 2009 for the ineffective portion of commodity hedges. If the hedging relationship ceases to behighly effective or it becomes probable that an expected transaction will no longer occur, future gains or losseson the derivative are recorded in cost of sales. The amount of losses reclassified from equity into earnings, as aresult of the discontinuance of cash flow hedges, was zero for 2011 and 2010 and $15 for 2009.

41

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

We hold certain derivatives to minimize the price risk for certain commodities for which we did not electhedge accounting treatment. If no hedging relationship is designated, changes in the derivative’s fair value arerecognized immediately in income. The impact to earnings was zero in 2011, 2010 and 2009.

Certain of our commodity purchase and sales contracts meet the definition of a derivative. These contractsare not required to be recorded at fair value if they qualify for the normal purchase normal sales (NPNS)exception as elected by the Company. Revenues and expenses on contracts that qualify for the NPNS exceptionare recognized when the underlying physical transaction is delivered. While these contracts are consideredderivative financial instruments, they are not recorded at fair value, but on an accrual basis of accounting. If it isdetermined that a transaction designated as NPNS no longer meets the scope exception, the fair value of therelated contract is recorded on the balance sheet and immediately recognized through earnings. At December 31,2008, we determined that several of our coal purchase contracts no longer qualified for the NPNS exceptionbecause of reduced coal requirements. During 2009, it was determined that these coal supply contracts no longermet the definition of a derivative. As a result, the fair value at the time of determination became its carryingvalue and will be amortized over the term of the contracts. We recognized in cost of sales a gain of $26 in 2010and a loss of $17 in 2009 related to these coal supply contracts.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in anorderly transaction between market participants at the measurement date. Accounting rules establish a fair valuehierarchy that distinguishes between (1) market participant assumptions developed based on market dataobtained from independent sources (observable inputs) and (2) an entity’s own assumptions about marketparticipant assumptions developed based on the best information available in the circumstances (unobservableinputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjustedquoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservableinputs (Level 3). The levels of the fair value hierarchy are described below:

• Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date foridentical, unrestricted assets or liabilities.

• Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset orliability, either directly or indirectly, including quoted prices for similar assets or liabilities in activemarkets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputsother than quoted prices that are observable for the asset or liability; and inputs that are derivedprincipally from or corroborated by observable market data by correlation or other means.

• Level 3 — Inputs that are both significant to the fair value measurement and unobservable.

We value our commodity swaps, classified as Level 2, using a market based approach based upon quotedprices for similar assets and liabilities in active markets. Physical commodity purchase contracts that are requiredto be recorded at fair value are valued using a market based approach based on management’s best estimate ofunobservable forward market prices. These contracts are classified as Level 3.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

The fair value hierarchy for our financial assets and liabilities accounted for at fair value and non-financialassets and liabilities accounted for at fair value on a recurring basis follows:

Level 1 Level 2 Level 3 Total

December 31, 2011

Assets:

Commodity derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ — $ 1 $ 1

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ — $ 1 $ 1

Liabilities:

Commodity derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $(12) $— $(12)

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $(12) $— $(12)

Net asset or (liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $(12) $ 1 $(11)

December 31, 2010

Assets:

Commodity derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ 4 $ 8 $ 12

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ 4 $ 8 $ 12

Liabilities:

Commodity derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ (1) $— $ (1)

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ (1) $— $ (1)

Net asset or (liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ 3 $ 8 $ 11

The derivative values above are based on an analysis of each contract as the fundamental unit of account asrequired by current accounting rules. Therefore, derivative assets and liabilities with the same counterparties arenot netted.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

There were no transfers between any levels of the fair value hierarchy during the year ended December 31,2011. A reconciliation of the changes in fair value of financial instruments measured at fair value on a recurringbasis using significant unobservable inputs (Level 3) follows:

Assets Liabilities

Balance at December 31, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ — $(13)

Total gains (losses):

Included in earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) (3)

Purchases, sales and settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 16

Transfers in /out of Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —

Balance at December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 —

Total gains (losses):

Included in earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (26) —

Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 —

Transfers in /out of Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —

Balance at December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1 $ —

Total gains for the period included in earnings (or changes in net assets)attributable to the change in unrealized gains or losses related to assets orliabilities held at the reporting date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1 $ —

Gains and losses, both realized and unrealized, included in earnings, as reported above, are reported in costof sales.

(9) Contingencies

We are subject to various legal actions and contingencies in the normal course of conducting business. Werecognize liabilities for such matters when a loss is probable and the amount can be reasonably estimated. Theeffect of the ultimate outcome of these matters on future results of operations and liquidity cannot be predictedwith certainty. While the resolution of these matters may have a material effect on the results of operations andcash flows of a particular quarter or year, we believe that the ultimate resolution of such matters in excess ofliabilities recorded will not have a material adverse effect on our competitive position in the steel industry orfinancial position.

ISG purchased only specified assets of Georgetown, Weirton, Bethlehem, Acme, and LTV through sales inbankruptcy proceedings. The sellers in those transactions retained liability for certain claims related to the assetsthat we purchased, including personal injury claims. The sale orders issued by the U.S. Bankruptcy Courtshaving jurisdiction over each respective transaction entered orders barring assertion of claims (other than those inrespect of certain specifically assumed liabilities, which did not include asbestos-related liabilities) against usrelated to the assets in question, and confirming that neither we nor our subsidiaries shall be responsible for anyliabilities related to the assets (other than those in respect of certain specifically assumed liabilities which did notinclude asbestos-related liabilities). The sale orders issued by the U.S. Bankruptcy Courts also found that underno circumstances could we be deemed a successor to any of the sellers for purposes of any liabilities. We believethe manner through which our facilities were purchased in conjunction with the attendant orders of the

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

U.S. Bankruptcy Court places us in a better position than other steelmakers with substantial exposure to asbestos-related liability or off-site environmental liability. Despite the foregoing it is possible that future claims withrespect to historic asbestos exposure could be directed at us. The risk of incurring liability as the result of suchclaims is considered remote.

On September 12, 2008, Standard Iron Works filed a purported class action complaint in U.S. District Courtin the Northern District of Illinois against ArcelorMittal, ArcelorMittal USA LLC, and other steel manufacturers,alleging that the defendants had conspired since 2005 to restrict the output of steel products in order to fix, raise,stabilize and maintain prices at artificially high levels in violation of U.S. antitrust law. Since the filing of theStandard Iron Works lawsuit, other similar direct purchaser lawsuits have been filed in the same court and havebeen consolidated with the Standard Iron Works lawsuit. In addition, two putative class actions on behalf ofindirect purchasers have been filed, one of which has already been consolidated with the Standard Iron Workscases and one of which ArcelorMittal is seeking to consolidate. In January 2009, ArcelorMittal and the otherdefendants filed a motion to dismiss the direct purchaser claims. On June 12, 2009, the court denied the motionto dismiss and the litigation is now in the discovery stage. At the current time, we are unable to reasonablyestimate the amount of potential liability, if any, from these cases.

The Company and an independent, unaffiliated producer of raw materials are parties to a long-term supplyagreement under which we were obligated to fund an escrow account to indemnify the producer of raw materialsfor the continuing availability of certain tax credits that extended through January 1, 2008. No contributions tothe escrow are required at this time as we believe the likelihood of the specific contingency occurring is remote.If there is any loss, disallowance or reduction in the allowable tax credits applicable to the raw materialspreviously sold to the Company, we are required to repay the producer the amount by which the cost of the rawmaterials was decreased as a result of such tax credits, subject to certain adjustments, plus interest. As ofDecember 31, 2011, the cumulative cost reduction due to such tax credits totaled $251.

On July 9, 2010 the Chesapeake Bay Foundation, the Baltimore Harbor Waterkeeper, and seven individualsfiled a complaint in the U.S. District Court for the District of Maryland. Severstal Sparrows Point LLC and theCompany are the named Defendants. The Complaint asserts seven separate alleged claims against Defendants:(1) a RCRA citizen suit claim based upon an “imminent and substantial endangerment;” (2) operation of ahazardous waste treatment facility without a permit in violation of RCRA; (3) violation of Maryland HazardousWaste Laws; (4) wastewater discharges in violation of the Clean Water Act (CWA); (5) violation of theMaryland Water Pollution Control Law; (6) violation of the facility’s NPDES permit under the CWA; and(7) violation of Maryland’s Erosion and Sediment Control Laws. Plaintiffs have demanded a jury trial.ArcelorMittal USA and ISG, operated the facility for several years where it is believed to have been in materialcompliance with all applicable environmental laws and associated standards. On March 20, 2008, OAO Severstalpurchased ISG Sparrows Point Steel LLC, its steelmaking operations and real estate. As a result of that sale,Severstal became fully responsible for the operation of the Sparrows Point plant. The Company has nocontinuing ownership or operational involvement. The Company filed a motion to dismiss on September 14,2010 and was granted summary judgment on a majority of the claims on July 5, 2011. On October 24, 2011, theplaintiffs filed a stipulation for dismissal of the Company and the Court entered an Order on October 25, 2011dismissing the matter against the Company with prejudice. Under the sale agreement with Severstal, we mustindemnify Severstal if it spends over $45 million on certain environmental matters. At the current time, wecannot estimate the amount of potential liability, if any, which may arise from this matter.

On September 17, 2010, a complaint was filed by SPS Limited Partnership, LLP and SPS 35, LLC, theneighboring shipyard owners to the adjacent Sparrows Point steel plant. The complaint was filed in the USDistrict Court of Maryland against Severstal Sparrows Point LLC and the Company for CERCLA cost recovery,

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

declaratory judgment, RCRA imminent and substantial endangerment, negligence, trespass, nuisance and strictliability. The claim is based upon benzene contamination which SPS alleges is migrating onto its property fromthe steel plant. The Complaint includes a demand for a jury trial. As in the preceding matter, OAO Severstalpurchased all of the Company’s interest in ISG Sparrows Point Steel LLC, its steelmaking operations and realestate. As a result of that sale a Severstal-owned entity became fully responsible for the operation of SparrowsPoint. We have no continuing ownership or operational involvement. The Company filed a motion to dismiss onNovember 29, 2010, was granted summary judgment on a majority of the claims on July 5, 2011 and filed itsanswer on August 2, 2011. On October 5, 2011, the Court entered a briefing schedule. Under the sale agreementwith Severstal, we must indemnify Severstal if it spends over $45 million on certain environmental matters. Atthe current time, we cannot estimate the amount of potential liability, if any, which may arise from this matter.

On April 8, 2011, ArcelorMittal and Cliffs Natural Resources Inc. (Cliffs) announced that they had reacheda negotiated settlement regarding all pending contract disputes related to the procurement by ArcelorMittal ofiron ore pellets for certain U.S. facilities. As part of the settlement, Cliffs and ArcelorMittal agreed to specificpricing levels for 2009 and 2010 pellet sales and related volumes. Cliffs and ArcelorMittal have agreed to replacethe previous pricing mechanism in one of the parties’ iron ore supply agreements with a world market-basedpricing mechanism in which the pellet price is indexed to the Platts published price for iron ore fines on aquarterly basis. The new pricing mechanism began in 2011 and will continue through the remainder of thecontract. The previous pricing mechanism was formula based including multiple market-related factors; however,under certain conditions, it allowed for price re-openers which would ultimately approximate market pricing inthe affected years. The renegotiated contract represents approximately 15% of our U.S. pellet requirements undernormal operating conditions and 30% of its total Cliffs pellet contracts.

Other contingent liabilities arise periodically in the normal course of business. In the opinion ofmanagement, any such unrecognized matters that are reasonably possible at December 31, 2011, would not havea material effect on our financial position, results of operations or cash flows.

(10) Stock Based Compensation

Share Unit Plan

At the ArcelorMittal annual shareholders’ meeting on May 10, 2011, a new equity-based incentive plan wasapproved to replace the Global Stock Option Plan. The new plan comprises a Restricted Share Unit Plan (RSUPlan) and a Performance Share Unit Plan (PSU Plan) designed to incentivize the targeted employees, to improvethe long-term performance of the Company and to retain key employees. Both the RSU Plan and the PSU Planare intended to promote the alignment of interests between the Company’s shareholders and eligible employeesby allowing them to participate in the success of the Company.

The RSU Plan

The aim of the RSU Plan is to provide a retention incentive to eligible employees. It is subject to “cliffvesting” after three years, with 100% of the grant vesting on the third anniversary of the grant contingent uponthe continued active employment of the eligible employee within the ArcelorMittal group. The RSUs are anintegral part of the Company’s remuneration framework in which it serves the specific objective of medium-termand long-term retention.

The maximum number of RSUs and PSUs available for grant during any given year is subject to the priorapproval of the Company’s shareholders at the annual general meeting.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

For the period from the May 2011 annual general shareholders’ meeting to the annual general meeting ofshareholders to be held in May 2012, a maximum of 2,500,000 RSUs may be allocated to eligible employeesunder the RSU Plan. The RSU Plan targets the 500 to 800 most senior managers across ArcelorMittal. ForAMUSA, in September 2011, a total of 196,040 shares under the RSU Plan were granted to a total of 90employees.

The fair value for the shares allocated to the beneficiaries is recorded as an expense in the consolidatedstatements of operations over the relevant vesting or service periods. The compensation expense recognized forthe restricted stock units was $0.2 for the year ended December 31, 2011.

The PSU Plan

The PSU Plan’s main objective is to be an effective performance-enhancing plan based on the employee’scontribution to the eligible achievement of the Company’s strategy. Awards under the PSU Plan are subject tothe fulfillment of cumulative performance criteria over a three-year period from the date of the PSU grant. Theemployees eligible to participate in the PSU Plan are a sub-set of the group of employees eligible to participate inthe RSU Plan. For the period from the May 2011 annual general shareholders’ meeting to the annual generalmeeting of shareholders to be held in May 2012 a maximum of 1,000,000 PSUs may be allocated to eligibleemployees under the PSU Plan. The allocation of PSUs is expected to take place in March 2012.

The Global Stock Option Plan

Prior to the adoption of the Share Unit Plan described above, ArcelorMittal’s equity-based incentive plantook the form of a stock option plan called the Global Stock Option Plan.

Under the terms of the ArcelorMittal Global Stock Option Plan 2009-2018 (which replaced theArcelorMittal Shares plan that expired in 2009), ArcelorMittal may grant options to purchase common stock tosenior management of ArcelorMittal and its associates for up to 100,000,000 shares of common stock. Theexercise price of each option equals not less than the fair market value of ArcelorMittal stock on the grant date,with a maximum term of 10 years. Options are granted at the discretion of ArcelorMittal’s Appointments,Remuneration and Corporate Governance Committee, or its delegate. The options vest either ratably upon eachof the first three anniversaries of the grant date, or, in total, upon the death, disability or retirement of theparticipant.

An addendum to the ArcelorMittal Global Stock Option Plan 2009-2018 was adopted to reduce by 5% theexercise prices of existing stock options, as a result of the spin-off of Aperam by ArcelorMittal. The impact ofthis change was to increase compensation expense by $2 during 2011. This change is reflected in the informationgiven below.

Date of Grant Initial Exercise Prices (per option) New Exercise Prices (per option)

August 2008 . . . . . . . . . . . . . . . . . . . . . $82.57 $78.44December 2007 . . . . . . . . . . . . . . . . . . 74.54 70.81August 2007 . . . . . . . . . . . . . . . . . . . . . 64.30 61.09June 2006 . . . . . . . . . . . . . . . . . . . . . . . 38.99 37.03August 2009 . . . . . . . . . . . . . . . . . . . . . 38.30 36.38September 2006 . . . . . . . . . . . . . . . . . . 33.76 32.07August 2010 . . . . . . . . . . . . . . . . . . . . . 32.27 30.66August 2005 . . . . . . . . . . . . . . . . . . . . . 28.75 27.31December 2008 . . . . . . . . . . . . . . . . . . 23.75 22.56November 2008 . . . . . . . . . . . . . . . . . . 22.25 21.14April 2002 . . . . . . . . . . . . . . . . . . . . . . 2.26 2.15

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Prior to 2003, the Company had chosen to account for stock-based compensation using the intrinsic valuemethod. Compensation cost for stock options is measured as the excess, if any, of the quoted market price ofArcelorMittal stock at the date of the grant over the amount an employee must pay to acquire the stock. Asindicated above, all options were granted at an exercise price equal to or greater than the fair market value on thedate of grant and no compensation expense was recognized in the financial statements. We expense stock-basedcompensation under the fair value recognition provisions prospectively for all employee awards granted,modified or settled after January 1, 2003. See Note 2, Summary of Significant Accounting Policies. We haveelected to apply the alternative transition method of ASC 718 Compensation — Stock Compensation to determineits historical pool of excess tax benefits.

2011 2010 2009

Fair value per share of options granted as determined by the Black-Scholesoption pricing model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $— $ 14 $ 20

Compensation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 26 7

Total tax benefit realized from stock options exercised . . . . . . . . . . . . . . . . . . (3) — —

Assumptions used to value those options granted:

Dividend yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 2.32% 1.96%

Expected annualized volatility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 52% 62%

Discount rate — Bond equivalent yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 2.92% 3.69%

Expected life in years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 6 6

The status of the ArcelorMittal Plan with respect to ArcelorMittal USA follows:

2011 2010 2009

Shares

WeightedAverage

Price Shares

WeightedAverage

Price Shares

WeightedAverage

Price

Options outstanding — beginning of theyear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,622,086 $50.93 3,770,856 $54.92 3,326,386 $59.23

Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 854,850 32.27 864,450 38.30

Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . (9,438) 12.41 (48,092) 19.94 (77,182) 25.94

Forfeitures . . . . . . . . . . . . . . . . . . . . . . . . . . (278,962) 52.30 (53,562) 54.98 (154,156) 56.17

Transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,000 36.95 98,034 47.21 (188,642) 64.97

Options outstanding — end of year . . . . . . . 4,350,686 $48.17 4,622,086 $50.93 3,770,856 $54.92

Options exercisable — end of year . . . . . . . 3,546,912 $51.71 2,840,011 $55.15 1,921,510 $50.77

48

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Grant Date Exercise Prices Shares OutstandingWeighted

Average Life Options Exercisable

April, 2002 2.15 37,995 .26 37,995August, 2005 27.31 318,109 3.65 318,109September, 2006 32.07 545,350 4.67 545,349August, 2007 61.09 756,568 5.59 756,568December, 2007 70.81 5,000 5.95 5,000August, 2008 78.44 1,038,700 6.60 1,038,700August, 2009 36.38 822,780 7.60 558,908August, 2010 30.66 826,184 8.60 286,283

Total 4,350,686 3,546,912

At December 31, 2011 we have 6,481,233 options vested and expected to vest. These have a weightedaverage exercise price of 36.91 and a weighted average remaining contractual life of 4.14. The intrinsic value ofvested options granted for all years is immaterial. The aggregate intrinsic value of all options presented is alsoimmaterial.

The weighted average remaining life of options outstanding and options exercisable follows:

Outstanding Exercisable

December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.48 years 6.07 years

December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.46 years 6.57 years

December 31, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.94 years 7.00 years

Upon completion of the acquisition of ISG, stock rights issued under a former ISG Stock AppreciationRights Plan were converted into similar rights in ArcelorMittal stock. These stock rights were granted to certainkey employees and provide employees a cash payment after vesting for the difference between the stock rightsprice and the market value of the stock on the date of exercise, with the award limited to 100% of the stock rightsprice. Stock rights vested in four substantially equal installments and expired five years after grant. As ofJanuary 1, 2009 there were 48,973 outstanding and exercisable rights. During 2009, 47,879 rights were exercised,and 1,094 rights were canceled or forfeited. None of these rights remain outstanding as of December 31, 2011.

(11) Pension and Other Postretirement Benefit Plans

Our accrued liabilities for pension and other postretirement benefits follow:

December 31

2011 2010

Payable to multiemployer pension plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9 $ 8

Pensions — defined benefit (including supplemental benefits plans) . . . . . . . . . . . 1,557 1,172

Other postretirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,384 4,053

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,950 5,233

Pensions in current accrued salaries, wages and benefits . . . . . . . . . . . . . . . . . . . . . (6) (5)

Other postretirement benefits in current accrued salaries, wages, and benefits . . . . (156) (153)

Long-term pension and other retiree benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $5,788 $5,075

49

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(a) 401k Savings Plan

We maintain a qualified savings plan for salaried employees under Section 401k of the Internal RevenueCode under which we match a specified portion of eligible employee contributions to the plan. Companycontributions were $17 in 2011 and $16 in 2010 and 2009. Additionally, the company contributed $5 in 2011,2010 and 2009 to a 401k plan for certain hourly employees at Weirton.

(b) Multiemployer Pension Plans

Our current labor agreement with the United Steelworkers (USW) expiring on September 1, 2012 requiresus to contribute to a multiemployer pension plan known as the Steelworkers Pension Trust (SPT) (EIN23-6648508 Plan No. 499). Almost all of our represented employees who are not eligible for the companysponsored defined benefit pension plan participate in the SPT. The SPT provides pension benefits uponretirement based on employer contributions and accrual rates while participating in the plan. We makecontributions to the SPT of $2.65 per contributory hour for most employees. Expense recognized forcontributions when the employee worked an eligible hour was $69 in 2011, $62 in 2010, and $60 in 2009.

Under a multiemployer plan several participating employers make contributions into a pension plan. Theassets of the plan can be used to pay the benefits of all participants (retirees and dependents) and are not limitedto the participants of a particular employer. If an employer stops contributing to the plan, any unfundedobligations may be borne by the remaining employers. Additionally if an employer no longer participates in theplan (for example because it no longer employs participants in the plan), it may be required to pay an amountbased on the underfunded status of the plan known as a withdrawal liability.

As of December 31, 2010 (the last date for which we have information) there were 545 participatingemployers in the SPT. Over the last three years our contributions were about 25% of the total contributions madeinto the plan. We along with two other companies made over half the contributions during this period. No otheremployer contributed more than 5%. As of December 31, 2010 the SPT had a total actuarial liability of $2,982and assets with a market value of $2,380. Liabilities were $2,778 and assets were $2,403 as of December 31,2009. As of December 31, 2010 the SPT was in the “green” zone under the Pension Protection Act of 2006,meaning that it is not presently considered endangered or in critical status. As such, the plan is not required toadopt a funding or improvement plan or implement contribution increases.

As part of the time charter of iron ore vessels, we reimburse the operators for contributions into theAmerican Maritime Officers Plan (EIN 13-1936709 Plan No. 1). The contributions were less than $1 in each ofthe last three years and were less than 1% of the contributions of all participating employers. As of the fiscal yearended September 31, 2011 the plan had an actuarial liability of $497 and assets of $307 with a fundingpercentage of 61.8%. As such it was considered to be in critical status. The plan adopted a rehabilitation planaimed at restoring its financial health. This plan included reducing certain benefits and placing a surcharge of10% on monthly contributions. This surcharge will not materially affect the amounts we reimburse the operatorsunder our time charters.

(c) Defined Benefit Pension Plans

We provide a non-contributory defined benefit pension plan covering substantially all USW representedemployees at our Hibbing Taconite joint venture and employees hired before November 2005 at the IndianaHarbor East and Minorca facilities (the former Inland operations). Hibbing’s benefits for hourly employees arebased on years of service and compensation. Benefits for employees represented by the USW at Indiana Harbor

50

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

East and Minorca are determined as a monthly benefit at retirement based on a fixed rate and service. Hibbing’snon-represented salaried employees and certain non-represented salaried employees of the former Inland hiredbefore January 1, 2003 also receive defined pension benefits. Benefits for most eligible salaried Inlandemployees are determined under a “Cash Balance” formula with an account balance for each participant thatgrows as a result of interest credits and of allocations based on a percent of pay. Benefits for other eligible Inlandemployees are determined as a monthly benefit at retirement depending on final pay and service. Certainrepresented former ISG employees receive a lump sum payment upon retirement. Employees at other facilitiesare not covered by a defined benefit pension plan.

We contributed ArcelorMittal stock of $43 during 2009 to the defined benefit pension plan. This transactionreduced our pension liability and increased amounts payable to ArcelorMittal. At December 31, 2011 our planassets include ArcelorMittal stock with a market value of $33. We expect to contribute about $279 of cash to ourdefined benefit pension plans in 2012.

(d) Postretirement Medical Benefits

Substantially all USW represented employees are covered under postretirement life insurance and medicalbenefit plans that require deductible and premium payments from retirees. The prescription drug benefit providedby our postretirement benefit plan is at least actuarially equivalent to those of Medicare Part D and, accordingly,we are entitled to the federal subsidy. The postretirement life insurance benefits are primarily specific amountsfor hourly employees.

Under our labor agreement we also contribute to a Voluntary Employee Beneficiary Association (VEBA)Trust to fund certain retiree medical and death benefits. We pay healthcare benefits to certain represented retireesof ISG predecessor companies (known as Legacy Retirees) in the form of a drug program and reimbursement ofa portion of Medicare premiums. Additionally agreements with the USW capped our share of healthcare costs forArcelorMittal USA retirees at 2008 levels for years 2010 and beyond. The VEBA can be utilized to the extentfunds are available for costs in excess of the cap for these retirees. Since we are ultimately responsible forfunding the VEBA and could be expected to fund any shortfalls, for accounting purposes, we determined there iseffectively no cap on future healthcare cost increases.

Under the 2008 labor agreement, we contribute $25 per quarter to a VEBA. An agreement with the USWallowed us to defer payments into the VEBA trust during the fourth quarter of 2008, for 2009 and for the firsttwo quarters of 2010. We resumed making these payments in the fourth quarter of 2010. Our current agreementcalls for making up these deferred contributions by August 31, 2012. Before that date, we are required to makeadditional payments of 10% of EBITDA in any quarter that ArcelorMittal USA’s EBITDA exceeds $25 up to anadditional payment of $25 for that quarter.

Hibbing provides retiree medical and death benefits to most full-time employees, hired before January 1,1993, with 30 years of service or employees who are 60 years of age with 15 years of service. We expect ourprorated required contribution to the Hibbing plan for other benefits to be $6 in 2012. Certain non-representedsalaried employees of the former Inland also receive retiree medical benefits. Employees who as ofDecember 31, 2006 had 30 years of service or more or were at least age 55 with at least 10 years of service willreceive retiree medical benefits until they become eligible for Medicare.

Beginning in 2013, the Patient Protection and Affordable Care Act of 2010 (PPACA) eliminates the taxdeductibility of prescription drug expenses allocable to the Medicare Part D subsidies received by an employer.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Because we have a valuation allowance on our deferred tax asset, we did not recognize any expense related to thereduction of this temporary item. The PPACA also imposes an excise tax on high-cost employer-sponsoredhealth plan coverage. Although our current plans are not subject to this tax, because the limits will be based ontotal inflation, which is below that projected for healthcare, we expect that eventually our plans will be subject tothis tax. Accordingly we considered the impact of this tax when we developed our long-term healthcare costtrend rate. In 2011 we received $2 under the Early Retiree Reinsurance Program (ERRP). The ERRP is atemporary program to reimburse the sponsor of employment-based health plans for a portion of the cost of healthbenefits provided to pre-Medicare participants.

As a result of the acquisition of the assets of certain businesses who declared bankruptcy, we are required toprovide lifetime medical coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985(COBRA) to the retirees of those businesses and their surviving spouses. Upon a retiree’s death, his or hersurviving spouse and dependent children may elect coverage up to an additional 36 months. We charge theparticipants a premium to participate in this program, and individuals who leave the program may not re-enter.Persons with ongoing illnesses or a high expectation of using healthcare services are more likely to enroll in thisprogram than others. COBRA regulations preclude the use of a factor to reflect this phenomenon in establishingpremiums. Therefore, we are likely to incur healthcare costs in excess of the premium amounts received from theparticipants. Accordingly, we recorded an actuarial liability based on assumptions regarding the number ofparticipants who will remain in the COBRA plan and their health status. Differences between our futureexperience and the actuarially expected amounts are amortized over the expected remaining lives of theparticipants. The amounts for lifetime COBRA are included in other benefits.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(e) Reconciliation of Changes in Benefit Obligations and Plan Assets

Pension and other postretirement benefits information, at our measurement dates follow:

Pension Other Benefits

2011 2010 2011 2010

Change in benefit obligation:

Benefit obligation — beginning of year . . . . . . . . . . . . . . $ 3,478 $ 3,246 $ 4,556 $ 3,946

Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 47 32 24

Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169 178 235 225

Net benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (241) (240) (206) (211)

Net actuarial losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265 247 280 572

Benefit obligation — end of year . . . . . . . . . . . . . . . . . 3,714 3,478 4,897 4,556

Accumulated benefit obligation for pensions . . . . . . . . 3,705 3,466 n/a n/a

Change in plan assets:

Fair value of plan assets — beginning of year . . . . . . . . . . 2,306 2,131 503 564

Net contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102 168 208 111

Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (241) (240) (203) (210)

Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . (10) 247 5 38

Fair value of plan assets — end of year . . . . . . . . . . . . . 2,157 2,306 513 503

Funded status of plan:

Unfunded obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,557) (1,172) (4,384) (4,053)

Amounts recognized in accumulated othercomprehensive loss:

Actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,807 1,463 1,407 1,182

Prior service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93 125 417 702

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,900 1,588 1,824 1,884

Net deferred (accrued) cost . . . . . . . . . . . . . . . . . . . . $ 343 $ 416 $(2,560) $(2,169)

53

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(f) Weighted Average Assumptions

Pension Other Benefits

2011 2010 2009 2011 2010 2009

Discount rate used to calculate periodic benefit cost:

Legacy retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . n/a n/a n/a 4.90% 5.60% 5.75%

Other retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.05% 5.70% 5.75% 5.45% 6.00% 5.75%

Discount rate used to value year-end obligation:

Legacy retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . n/a n/a n/a 4.15% 4.90% 5.60%

Other retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.30% 5.05% 5.70% 4.55% 5.45% 6.00%

Expected long-term return on plan assets: . . . . . . . . . . . . . . . .

Legacy retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . n/a n/a n/a 6.00% 6.00% 6.00%

Other retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.50% 8.50% 8.50% 8.50% 8.50% 8.50%

Average rate of compensation increase . . . . . . . . . . . . . . . . . 3.00% 3.00% 3.00% n/a n/a n/a

Projected health care cost trend rate:

Pre-Medicare . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . n/a n/a n/a 7.50% 7.50% 7.20%

Post-Medicare . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . n/a n/a n/a 7.50% 7.65% 9.20%

Ultimate trend rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . n/a n/a n/a 5.00% 5.00% 4.50%

Year ultimate trend rate is reached . . . . . . . . . . . . . . . . . . . . n/a n/a n/a 2019 2016 2019

Net periodic benefit cost:

Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 43 $ 47 $ 52 $ 32 $ 24 $ 26

Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169 178 182 235 225 216

Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . (203) (202) (205) (31) (32) (38)

Amortization of actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . 133 95 100 82 43 38

Amortization of prior service cost . . . . . . . . . . . . . . . . . . . . . . . 33 33 32 284 322 322

Total net periodic postretirement benefit cost . . . . . . . . . . . . $ 175 $ 151 $ 161 $ 602 $ 582 $ 564

In 2012, we expect to recognize losses of $180 and prior service costs of $26 for pensions and losses of $93and prior service costs of $43 for other benefits.

A one percentage point increase or decrease in assumed health care cost trend rates follow:

Increase Decrease

Effect on total annual service and interest cost components . . . . . . . . . . . . . . . . . . $ 41 $ (34)

Effect on accumulated postretirement benefit obligation . . . . . . . . . . . . . . . . . . . . 650 (540)

(g) Plan Asset Information

Key investment objectives are:

• Investments are made solely in the interest of the participants and beneficiaries and for the exclusivepurpose of providing benefits to such participants and their beneficiaries and defraying reasonableadministration expenses.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

• The investment objectives shall be to: (1) provide long-term growth (in the form of income and/or capitalappreciation) to maximize the amounts available to provide benefits to participants and their beneficiariesand (2) maintain adequate liquidity to permit timely payment of all benefits. In carrying out theseobjectives, short-term fluctuations in the value of the assets shall be considered secondary to long-terminvestment results.

• Assets shall be invested with care, skill, prudence and diligence.

• The investments shall be diversified so as to minimize the risk of large losses, unless under thecircumstances it is clearly prudent not to do so.

We use a long-term rate of return assumption of 8.50% for our pension plan assets and 6.00% for our otherbenefit plan assets. The return assumption is viewed in a long-term context, supported by the asset allocation ofthe trust, and is evaluated annually. Our policies provide for broad ranges around targets to reduce rebalancingtrading cost and facilitate the management of the fund. We monitor investment risk on an ongoing basis, in partthrough the use of quarterly investment portfolio reviews and reporting, periodic asset/liability studies, andmonitoring of the plan’s funded status. To achieve our investment objectives, we focus on maintaining adiversified portfolio using various asset classes in order to achieve our long-term investment objectives on a riskadjusted basis. Our actual investment positions in various securities change over time based on short and longer-term opportunities. Our target allocations by asset type for the ArcelorMittal USA Pension Trust (Pension) andthe VEBA Trust (Other Benefits) follow:

Pension Other Benefits

Equity securities — domestic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 to 60% —

Equity securities — international . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 to 35% —

Fixed income (including cash) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 to 45% 80%

Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 to 10% —

Alternative investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 to 25% 20

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100% 100%

Alternative investments include investments in distressed debt, hedge fund-of-funds, and opportunistic fixedincome funds.

55

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

See Note 8 Derivative Instruments and Hedging Activity for a description of the three-level fair valuehierarchy. The fair values of our pension plan and other benefit plan assets by asset category and fair valuehierarchy are as follows:

Pension Assets Other Benefit Assets

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

December 31, 2011:

Equity securities — domestic . . . . . . . . . . . $ 429 $244 — $ 673 $11 — — $ 11

Equity securities — emerging market . . . . . 71 — — 71 — — — —

Equity securities — international . . . . . . . . 346 6 — 352 5 — — 5

Fixed income (including cash) . . . . . . . . . . . 105 453 — 558 13 393 — 406

Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . — — 111 111 — — 2 2

Alternative investments . . . . . . . . . . . . . . . . 1 — 391 392 1 — 88 89

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 952 $703 $502 $2,157 $30 $393 $90 $513

December 31, 2010:

Equity securities — domestic . . . . . . . . . . . $ 488 $217 — $ 705 $10 — — $ 10

Equity securities — emerging market . . . . . 85 — — 85 — — — —

Equity securities — international . . . . . . . . 449 9 — 458 5 — — 5

Fixed income (including cash) . . . . . . . . . . . 122 440 — 562 14 466 — 480

Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . — — 98 98 — — — —

Alternative investments . . . . . . . . . . . . . . . . 2 — 396 398 1 — 7 8

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,146 $666 $494 $2,306 $30 $466 $ 7 $503

A brief description of the valuation methodologies for measuring assets at fair value follows:

• Equity securities are valued at the closing price reported on the active market on which the security istraded. Some common collective trust investments consist of publicly traded equity securities but the funditself is not publicly traded, so these investments are classified Level 2.

• Fixed income assets consist of corporate bonds and notes, preferred stock, mutual funds, governmentsecurities, and common collective trusts. Fixed income mutual funds and some government securitiesmade up of treasury notes and bonds are Level 1 since there is an active publicly traded market. Corporatebonds and collective trusts are classified as Level 2 as the underlying securities are not publicly traded butthere is an observable price for similar securities in the market. Most Level 3 assets within this group arewhere the issuer is in bankruptcy proceedings making the underlying holdings fair valued based.

• Real estate is valued at the fair value of the underlying assets held at year-end, which the custodian of thefund obtains from third-party appraisers.

• Generally, alternative assets are valued at the Company’s proportionate share of the fair value of the fundas of year-end, which the custodian of the fund obtains from third-party pricing services.

56

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Changes in the fair value of Level 3 assets follow:

2011 2010

Real EstateInvestments

OtherInvestments

Real EstateInvestments

OtherInvestments

Balance — beginning of year . . . . . . . . . . . . . . $ 98 $403 $83 $380

Actual return on plan assets:

Relating to assets still held at year-end . . . . . 9 — 8 25

Relating to assets sold during the year . . . . . — 18 — (6)

Purchases, sales and settlements . . . . . . . . . . . . 6 58 7 4

Balance — end of year . . . . . . . . . . . . . . . . . . . $113 $479 $98 $403

(h) Estimated Future Payments to Beneficiaries

PensionOther

Benefits

2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 260 $ 248

2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 262 265

2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264 281

2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265 296

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264 308

2017 to 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,289 1,650

(12) Taxes

The U.S. and foreign components of loss before income taxes follow:

2011 2010 2009

United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(208) $(853) $(1,647)

Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) (3) (6)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(211) $(856) $(1,653)

The provision for income taxes follows:

2011 2010 2009

Current:

Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(13) $ 13 $(283)

State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 1 (14)

Deferred:

Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 (10) 914

State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 109

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 23 $ 13 $ 726

57

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

A reconciliation of income taxes at the statutory U.S. tax rate of 35% to the recorded provision follows:

2011 2010 2009

Taxes at statutory rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (74) $(299) $ (579)Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161 379 1,387State and local income taxes, net of federal effect . . . . . . . . . . . . . . . . . . . . 6 (21) (50)Percentage depletion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (53) (29) (10)Adjustment for uncertain tax positions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 8 (2)Medicare part D subsidy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) 3 (20)General business tax credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1) (29) (5)Prior year return to provision adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . (8) 2 (2)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8) (1) 7

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 23 $ 13 $ 726

The amounts reported in the table above for change in valuation allowance and valuation allowancereclassification from other comprehensive income include the effect on federal, foreign, state and local incometaxes.

We record deferred taxes for NOL and tax credit carryforwards and temporary differences between theamount of assets and liabilities recognized for financial reporting purposes and such amounts recognized for taxpurposes. The components follow:

December 31

2011 2010

Current deferred tax assets:Financial accruals and reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 103 $ 205Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (63) (116)

Total current deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 89Current deferred tax liabilities:

Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (50) (36)

Net current deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (10) $ 53

Non-current deferred tax assets:Net operating loss carryforwards and AMT credits . . . . . . . . . . . . . . . . . . . . . . $ 896 $ 804Employee benefit costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,163 1,926Intangibles and unfavorable contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 34Environmental liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 80Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 29Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,941) (1,622)

Total non-current deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,258 1,251Non-current deferred tax liabilities:

Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,261) (1,278)

Net non-current deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (3) $ (27)

58

ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

At December 31, 2011, we had federal NOLs of $2,041 of which $564 are limited by Internal RevenueCode (IRC) Section 382, and $604 were generated by Inland. We also had $49 of general business credits and$34 of AMT credits, of which $20 are subject to IRC Section 382 limits. IRC section 382 limits the historical taxattributes acquired by ISG from Bethlehem. The NOLs expire in varying amounts from 2017 through 2031, thegeneral business credits expire from 2026 to 2030, and the AMT credits can be carried forward indefinitely.

We are required to record a valuation allowance for a deferred tax asset when it is “more likely than not” (alikelihood of more than 50%) that some or all of the deferred tax asset will not be realized. During 2009 weweighed both the positive and negative evidence with respect to whether we would realize these assets. Based onour recent history of losses, we concluded that it was more likely that we would not realize our deferred tax asset.Accordingly we recorded a valuation allowance in 2009. The impact of increasing this valuation allowance by$266 in 2011 was to increase income tax expense by $161 and we also recorded an intraperiod tax allocationimpact of $105.

Accounting rules require that we allocate our income tax provision or benefit between continuingoperations, discontinued operations, and other comprehensive income. In 2009, we recognized pre-tax loss incontinuing operations and pre-tax income in other comprehensive income. When there is a pre-tax loss fromcontinuing operations and pre-tax income in another category, tax expense is allocated to the other sources ofincome, with a related benefit recorded in continuing operations. However, the amortization of losses and priorservice cost for pension and other postretirement benefits are reclassification of expenses from othercomprehensive income into continuing operations. This reclassification does not affect our overall deferred taxposition and is not a new economic event, so in total it does not affect our total income tax benefit for the year.Therefore we did not allocate any income tax expense related to this item to other comprehensive income with acorresponding benefit in continuing operations. This caused our tax rate for other comprehensive income to beless than the statutory rate, with a corresponding impact to continuing operations of $187 in 2009. Since we had apre-tax loss in both continuing operations and other comprehensive income in 2010 and 2011, there was noincome tax provision or benefit amounts recognized in other comprehensive income after consideration ofvaluation allowance.

ArcelorMittal USA is part of a larger controlled group that files U.S. federal income taxes. ArcelorMittalUSA Holdings Inc. (our parent company) has a full valuation allowance on its deferred taxes. Our policy is torecord deferred taxes at the subsidiary level based on the temporary differences and NOLs recorded on thefinancial statements of those subsidiaries. We recognize deferred tax assets to the extent that there are deferredtax liabilities recognized in the financial statements of other companies in our controlled group. The 2010provision also included $9 of expense for the decrease in net deferred tax liabilities recorded by other companiesin our controlled group. The 2011 provision includes $26 of expense as a result of the change to a net deferredtax asset position in 2011 for the other companies in our controlled group. We also record current taxes at thesubsidiary level based on estimated taxable income or loss for those subsidiaries. ArcelorMittal USA included $9of current tax expense in the 2010 provision due to estimated taxable income in 2010. We reported taxable loss in2010 and so the 2011 provision includes $9 of current tax benefit to reverse the $9 of current tax expenserecorded in 2010.

The amounts recorded for income taxes reflect our tax positions based on research and interpretations ofcomplex laws and regulations. The Company and/or its subsidiaries file income tax returns in the U.S. federaljurisdiction as well as various state and local jurisdictions. Our income tax returns are subject to audit by the IRSas well as state and local tax authorities. The IRS has audited the tax returns of Inland through 2000 and of ISGthrough 2004. Our unutilized NOLs were generated in 1998 and later. Until these NOLs are utilized, the tax

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

returns for 1998 and all later years could be subject to examination. The IRS has initiated an examination of theI/N Tek and I/N Kote partnerships for the years 2006 through 2009. No adjustments have been proposed as ofDecember 31, 2011. There are no other open IRS audits at December 31, 2011. For most state tax jurisdictionsthe statute of limitations is open for three or four years. There are no ongoing material state income taxexaminations.

A reconciliation of the changes for our unrecognized tax benefits follows:

2011 2010 2009

Balance — beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $139 $131 $133

Additions based on tax positions related to the current year . . . . . . . . . . . . . . 3 8 —

Reductions for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (2)

Balance — end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142 139 131

Recorded in deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 118 102

Recorded in accrued taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20 $ 21 $ 29

The future resolution of tax issues could affect our financial results and cash flow. The amount ofunrecognized tax benefit that, if recognized, would affect the effective tax rate in future periods is $20.

We recorded interest expense of $1 in 2011, $2 in 2010, and $4 in 2009. At December 31, 2011 and 2010,accrued interest and penalties were $23 and $22.

(13) Closure and Severance Liabilities

Over the last five years we took steps to improve results at our Weirton plant including shutting downoperations and reducing employment. Over the last three years spending of about $8 related to employeetermination costs for that operation. Substantially all of the recorded liability for Weirton has been spent. In 2005we permanently idled our hot briquette iron plant in Trinidad, about $9 (principally for contractual obligations)remains unspent. The liability is included in the accrued salaries, wages and benefits line of the balance sheet.

In 2008 we announced the permanent closure of our cold rolling and coating facilities in Lackawanna andHennepin affecting about 500 employees. These operations stopped production in the first quarter of 2009.Employees were placed on lay off and received supplemental unemployment benefits for a certain period. Onceemployees severed they received a one-time payment. In total we accrued $34 for employee terminations and $1for contract terminations. To date all but $5 has been spent.

In 2009 we announced a voluntary severance program for non-represented employees that met certaineligibility criteria. Employees who elected to sever received a lump sum payment equal to one year’s pay and ahealthcare premium subsidy. A total of 256 employees elected to take the offer. We accrued a total of $27. Alsoduring 2009 because of decreased demand for our products, we reduced our operating levels and placedemployees on lay off. Employees on lay off received supplemental unemployment benefits. During 2009 weaccrued $37 for these benefits. As of December 31, 2011 all but $4 has been spent.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

Activity related to these liabilities follow:

EmployeeTermination/Severance

ContractTermination

2011 2010 2009 2011 2010 2009

Balance — beginning of year . . . . . . . . . . . . . . . . . . . . . $22 $ 46 $ 12 $ 9 $11 $13

Recognized in earnings (primarily in Cost of sales) . . . . (4) (1) 95 — (2) (1)

Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9) (23) (61) — — (1)

Balance — end of year . . . . . . . . . . . . . . . . . . . . . . . . $ 9 $ 22 $ 46 $ 9 $ 9 $11

(14) Commitments

We have entered into various agreements in which we are obligated to make payments under contractualpurchase commitments, including unconditional purchase obligations. The majority of these commitments relateto services, utilities, natural gas transportation, industrial gases and certain raw materials. We lease certainmanufacturing equipment, office space and computer equipment under non-cancelable leases that expire atvarious dates through 2034. Rental expenses on operating leases were $85 in 2011, $80 in 2010, and $49 for2009. Based upon prices in effect at December 31, 2011, firm commitments relating to these agreements andfuture minimum operating lease payments under non-cancelable operating leases follow:

FirmCommitments

OperatingLease

Obligations

2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,340 $ 36

2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,607 30

2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,056 28

2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 782 25

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 346 18

Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,716 59

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $7,847 $196

We recorded gains of $33 in 2011, $13 in 2010, and $165 in 2009 on firm sales and purchase commitmentsin cost of sales.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(15) Environmental Matters and Asset Retirement Obligations

We are subject to changing and increasingly stringent environmental laws and regulations concerning airemissions, water discharges and waste disposal, as well as certain remediation activities that involve the clean upof environmental media such as soils and groundwater. If, in the future, we are required to investigate andremediate any currently unknown contamination or new information is obtained about required remediationactivities at a site which we own, we could be required to record additional liabilities. Environmental liabilitiesassumed in a business combination are discounted at 4.75%. Other environmental liabilities are not discounted.Asset retirement obligations are discounted between 6.15% and 9.93% depending on the year the liability wasestablished. The activity associated with these liabilities follow:

Environmental LiabilitiesAsset Retirement

Obligations

2011 2010 2009 2011 2010 2009

Balance — beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . $206 $209 $219 $ 14 $ 15 $ 16

Accretion and changes in estimates and timing of spending . . . 2 2 2 2 — —

Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11) (8) (12) (1) (1) (1)

Related to properties sold during the year . . . . . . . . . . . . . . . . . — (2) — — — —

Reclassification from another liability . . . . . . . . . . . . . . . . . . . (4) 5 — 9 — —

Balance — end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193 206 209 24 14 15

In accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . (22) (23) (17) (1) (2) (1)

In other long term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . $171 $183 $192 $ 23 $ 12 $ 14

Undiscounted amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $274 $285 $339 $ 55 $ 29 $ 31

The decrease in the undiscounted amount from 2009 to 2010 was a result of a change in the estimate for theamount and timing of our acid mine treatment costs. We expect spending will eventually end as a result ofnatural attenuation. However the current rate of spending will continue for a longer period before operationalimprovements are in place. Our estimated liability did not significantly change in total.

Undiscounted expenditures related to these liabilities for the next five years follow:

2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $24

2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

The accrued environmental liabilities are estimates. The significant assumptions that underlie our estimatesmay be impacted by changing circumstances that affect the reasonableness of such estimates including thefollowing:

• the legal analysis applied to determining the existence of an obligation,

• the nature and scope of the obligation,

• the technical data utilized to evaluate engineering or other actionable solutions,

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

• the financial data utilized to calculate a range of cost estimates to effect engineering or other solutions,

• the appropriateness and technical feasibility of selected engineering or other actions,

• regulations and other governmental requirements applicable to the liability or obligation will remainconstant, and

• the financial obligation to address the obligation is solely that of the Company.

Changing circumstances that may impact the reasonableness of the estimates include:

• the validity of the assumptions underlying the estimate,

• a change in factors or laws that may affect the nature and scope of the liability or obligation,

• new information that may impact the range of engineering or other actions that are appropriate andfeasible to address the liability or obligation, and

• change in applicable markets and economies that impact costs.

The accrued environmental liabilities are based on engineering estimates and are described below in thecontext of applicable environmental regulation by relative locations.

Under the Resource Conservation and Recovery Act (RCRA) and similar U.S. state programs, the owners ofcertain facilities that manage hazardous wastes are required to investigate and, if appropriate, remediate historicenvironmental contamination found at such facilities. All of our major operating and inactive facilities are or maybe subject to a corrective action program or other laws and regulations relating to environmental remediation,including projects relating to the reclamation of industrial properties, also known as brownfield projects.

Our properties in Lackawanna, New York, when acquired were subject to an Administrative Order onConsent with the U.S. Environmental Protection Agency (EPA) requiring facility-wide RCRA Corrective Action.The Administrative Order, entered into in 1990 by the former owner Bethlehem Steel, requires us to complete aRCRA Facilities Investigation (RFI) and a Corrective Measures Study (CMS), to implement appropriate interimand final remedial measures, and to perform required post-remedial closure activities. In 2006, the US EPA andNew York State Department of Environmental Conservation who have been delegated authority for RCRACorrective Actions conditionally approved the RFI and vacated the 1990 Administrative Order. In 2009, weentered into an Order on Consent to complete the CMS and perform Corrective Actions on some or all of theremaining solid waste management units (SWMUs) and water bodies. These actions included installation andoperation of a ground water treatment system and dredging of a local waterway known as Smokes Creek. Wehave recorded liabilities of $44 for the future cost of performing anticipated remediation and post remediationactivities that will be completed over a period of 15 years or more. The amounts are based on the extent of soiland groundwater contamination identified by the RFI and the remedial measures likely to be required, includingexcavation and consolidation of containments in an on-site landfill and continuation of groundwater pump andtreatment systems.

We are required to prevent acid mine drainage from discharging to surface waters at closed miningoperations in southwestern Pennsylvania. In 2003, we entered into a Consent Order and Agreement with thePennsylvania Department of Environmental Protection (the PaDEP) requiring submission of an operationalimprovement plan to improve treatment facility operations and lower long-term wastewater treatment costs. TheConsent Order and Agreement also required us to propose a long-term financial assurance mechanism. In 2004,we entered into a revised Consent Order and Agreement outlining a schedule for implementation of capital

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

improvements and requiring the establishment of a treatment trust that the PaDEP has estimated to be the netpresent value of all future treatment costs. We have been funding the treatment trust and have a period of severalyears to reach the current target value of approximately $44. This target value is based on average spending overthe last three years. We currently expect this rate of spending and the target value to decrease once theoperational improvement plans are in place. The trust has a fair value of $19 at December 31, 2011. After thetreatment trust is fully funded, we can be reimbursed from the treatment trust fund for the continuing cost oftreatment of acid mine drainage. Although remote, we could be required to make up any deficiency in thetreatment trust in the future.

We own a large former integrated steelmaking site in Johnstown, Pennsylvania. The site has been razed andthere are a number of historic waste disposal units, including solid and hazardous waste landfills located at thesite that are subject to closure and other regulation by PaDEP. There are also historic steel and coke-makingoperating locations at the Johnstown site that may have caused groundwater contamination. Although potentiallysubject to RCRA corrective action or similar state authority, no comprehensive environmental investigationshave been performed at this site to date. We have recorded liabilities for costs associated with future landfillclosure, site investigations and probable remediation at this facility of $13.

In 1990, our Indiana Harbor East, Indiana facility was party to a lawsuit filed by EPA under RCRA. In1993, we entered into a Consent Decree, which, among other things, requires facility-wide RCRA CorrectiveAction and sediment assessment and remediation in the adjacent Indiana Harbor Ship Canal. We estimate thefuture costs to be $9 for RCRA Corrective Action, and $25 for sediment assessment and remediation at this site.Remediation ultimately may be necessary for other contamination that may be present at Indiana Harbor East,but the potential costs of any such remediation cannot yet be reasonably estimated.

Our Indiana Harbor West, Indiana facility is subject to an EPA 3013 Administrative Order investigationplan to assess soil and groundwater conditions associated with 14 solid waste management units approved in2005. Although localized remediation activities have been conducted at this facility, additional remediation maybe required after the investigation of these solid waste management units has been completed. It is not possible toestimate the cost of required remediation or monitoring, if any, that may result from this investigation at thistime. In addition, an area of subsurface fuel oil contamination exists and is currently the subject of remediationactions. The EPA and the Company are discussing a draft administrative order with respect to the oil issue. Inaddition, a solid waste landfill at Indiana Harbor West was closed during 2007 and will require closure and post-closure care including groundwater monitoring. The total liability related to these matters is $3.

At our Burns Harbor, Indiana facility, an RFI was completed in accordance with an EPA approved workplan. Based on the results of the investigation, we do not believe there will be any substantial remediationrequired to complete the corrective action process at the facility; however, it is likely that we will incur futurecosts primarily related to long term post-closure care including groundwater monitoring. In addition, Bethlehemmanaged about one million net tons of air pollution control dusts and sludges in piles on the ground at the site.While an alternative means of handling this material continues to be evaluated, including potentially landfillingin the recently permitted on-site Deerfield Storage facility, it is probable that we will incur additional future coststo manage this material. We also have a continuing obligation under a consent order issued by the U.S. DistrictCourt in Indiana to operate a collection and treatment system to control contaminated groundwater seeps fromthe face of a dock wall at the site. The total recorded liability related to these matters is $23.

Our Cleveland, Ohio facility may be subject to RCRA corrective action or remediation under otherenvironmental statutes. An integrated steel facility has operated on the property since the early part of the

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

20th century. As a result, soil and groundwater contamination may exist that might require remediation pursuantto the RCRA corrective action program or similar state programs. No RCRA corrective action has beendemanded at the Cleveland facility by either U.S. federal or state authorities and no comprehensive investigationof any of the facilities has been performed. However, we continue discussions with the Ohio EPA in regards tocertain limited and localized remediation activities that have been or will be conducted at these sites. The totalliability related to these matters is $13. These remediation activities include a large permitted solid waste landfillat the site that will require installation of an engineered capping system for closure and post-closure careincluding groundwater monitoring in the future. The liability recorded for the cost of closure and post-closurecare for this landfill is $3.

Our Weirton, West Virginia facility has been subject to a RCRA corrective action related consent decreesince 1996. The order requires the facility to conduct investigative activities to determine the nature and extent ofhazardous substances that may be located on the facility’s property and to evaluate and propose correctivemeasures needed to abate unacceptable risks. Areas within the facility’s property have been prioritized.Investigation of the two highest priority areas and closure of the surface impoundment has been completed.Investigation of the remaining areas and continuing remediation is underway. We are in communication with theU.S. EPA and West Virginia Department of Environmental Protection regarding other potential RCRA concernsat the site. The liability for the cost of investigative and closure activities is $21.

Our facility at Riverdale, Illinois may be subject to RCRA corrective action or remediation under otherenvironmental statutes. The facility has produced steel since the early part of the 20th century. As a result, soiland groundwater contamination may exist that might require remediation under the RCRA corrective actionprogram or similar state programs. Certain localized remediation activities have been conducted at this facility;however, there is no present U.S. federal or state demand for a RCRA corrective action program at the facility.No comprehensive environmental investigation of the facility has been performed.

Our Minorca Mine, through the Environmental Impact Statement process, has a reclamation plan on filewith the state of Minnesota. Each year the Minnesota Department of Natural Resources requires Minorca tosubmit an annual mining and reclamation summary for the year just completed and to provide mining andreclamation plans for the coming year. When possible, Minorca reclaims abandoned areas on a yearly basis.Currently, we are in compliance with all environmental standards and therefore, we expect little or noenvironmental remediation at the time of closure of the mine. The recorded liability for these future reclamationcosts is $7. We also recognize our share related to reclamation and closure of the Hibbing Taconite joint venture.The recorded liability for these closure costs is $10.

We have recognized liabilities of $35 over the next 40 years to address the removal and disposal of PCBequipment and thermal asbestos material encountered during the operation of our facilities. We have additionalasbestos in our facilities in the form of sheeting in our buildings. Because this asbestos is not exposed or can bemanaged through normal maintenance, we are not required to remove this material and would not be required todo so until we demolish the buildings. We have buildings of varying ages in our facilities, some over 100 yearsold. We plan to continue to use these buildings indefinitely and are unable to estimate when we would demolishthe buildings and remove the associated asbestos. Therefore no amounts have been accrued for this removal ofthis form of asbestos.

There are a number of other facilities and properties that we own across the United States which maypresent incidental environmental liabilities. The total liabilities recorded for these future investigations andprobable remediation is $8.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

In 2008 we sold our Sparrows Point facilities. The buyer assumed the environmental liabilities associatedwith the properties. We remain contingently liable for environmental costs in excess of certain amounts. Wecurrently do not expect to make any payments for these contingent liabilities.

In 2006, the U.S. EPA Region V issued our Burns Harbor facility a Notice of Violation (NOV) alleging thatin early 1994 the facility (then owned by Bethlehem Steel) commenced a major modification of its #2 CokeBattery without obtaining a Prevention of Significant Deterioration (PSD) permit and has continued to operatewithout the appropriate PSD permit. We have discussed the allegations with the EPA, but to date there have beenno further formal proceedings. The U.S. EPA Region V also has conducted a series of inspections and submittedinformation requests under the U.S. Clean Air Act relating to Burns Harbor and other facilities located in Indianaand Ohio. We held discussions with the EPA and state environmental agencies regarding their concerns. Duringsuch discussions, in addition to the matters raised in the NOV, EPA alleged that Burns Harbor, Indiana Harborand Cleveland were non-compliant with certain requirements of the U.S. Clean Air Act. Some of EPA’sallegations relate to recent compliance performance and some relate to acts by former facility owners thatoccurred 15 to 25 years ago. In addition, at the end of October 2011, some of our facilities in Indiana and Ohioreceived NOVs from U.S. EPA for Title V permit self-reported deviations and excursions. Preliminary analysisby counsel indicates that the allegations related to the acts of former owners appear to be unsound and that thecurrent operations at Burns Harbor, Indiana Harbor and Cleveland achieve high rates of compliance with existingor, where applicable, anticipated permits and regulations under the U.S. Clean Air Act. Further discussions withEPA and affected state environmental agencies are planned with regard to EPA’s expressed concerns.

CERCLA and analogous state laws can impose liability for the entire cost of cleanup at a site upon currentor former site owners or operators or parties who sent hazardous materials to the site, regardless of fault or thelawfulness of the activity that caused the contamination. We are a potentially responsible party at several stateand federal Superfund sites. Except as may be referenced elsewhere in this document, we believe our liability atthese sites is either de minimis or substantially resolved. We could, however, incur additional costs or liabilitiesat these sites based on new information, if additional cleanup is required, private parties sue for personal injury orproperty damage, or other responsible parties sue for reimbursement of costs incurred to clean up the sites. Wecould also be named a potentially responsible party at other sites if the Company’s hazardous materials or thoseof its predecessor were disposed of at a site that later becomes a Superfund site. ISG purchased substantially allof its assets through sales in bankruptcy proceedings. The U.S. Bankruptcy Courts having jurisdiction over eachtransaction explicitly specified that the sellers retained certain historic liabilities, including Superfund liabilities.Despite the foregoing, it is possible that future claims might be directed at us. We consider the risk of incurringliability as the result of such claims extremely remote.

In July 2004, the Illinois Environmental Protection Agency (IEPA) notified us that we were a potentiallyresponsible party in connection with alleged contamination relating to Hillside Mining Co., a company thatInland operated in the 1940s and whose assets it sold in the early 1950s. The IEPA has required other potentiallyresponsible parties to conduct an investigation of certain areas of potential contamination and it is likely that wemay be required to participate at some level in the future. We intend to defend ourself fully in this matter. As ofDecember 31, 2011, we were not able to reasonably estimate the amount of liabilities relating to this matter, ifany.

We spent $118 in 2011 for recurring costs to manage hazardous substances and pollution in ongoingoperations. In addition to expenditures relating to existing environmental liabilities, we will invest significantsums in response to changes in environmental laws and regulations.

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ARCELORMITTAL USA LLC

Notes to Consolidated Financial Statements(Dollars in millions, except share and per share)

(16) Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss follow:

December 31

2011 2010

Unrecognized pension and other postretirement benefit cost . . . . . . . . . . . . . . . . . $(3,783) $(3,518)

Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,424 1,424

Net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(2,359) $(2,094)

Derivative financial instruments designated as cash flow hedges . . . . . . . . . . . . . $ (10) $ 4

Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —

Net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (10) $ 4

Accumulated other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(2,369) $(2,090)

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