Dan Lesnak - Manager, Investor Relations John Surma - Chairman and Chief Executive Officer Mario Longhi - President and Chief Operating Officer Gretchen Haggerty - Executive Vice President and Chief Financial Officer

Michelle Applebaum - Michelle Applebaum Research Evan Kurtz - Morgan Stanley Sal Tharani - Goldman Sachs Dave Katz - JPMorgan Gordon Johnson - Axiom Capital Management Timna Tanners - Bank of America David Gagliano - Barclays Luke Folta - Jefferies Brian Yu - Citigroup Aldo Mazzaferro - Macquarie Equities Research

Ladies and gentlemen, thank you for standing by. Welcome to the U.S. Steel Second Quarter 2013 Earnings Conference Call. For the conference, all the participants are in a listen-only mode. (Operator instructions) As a reminder, today’s call is being recorded. With that being said, I will turn the conference over to the Manager, Investor Relations, Mr. Dan Lesnak. Please go ahead sir.

Thank you, John. Good afternoon, and thank you for participating in the United States Steel Corporation’s second quarter 2013 earnings conference call and webcast. For those of you participating by phone, the slides that are included on the webcast are also available under the Investors section of our website at www.ussteel.com. We will start the call with the introductory remarks from U.S. Steel Chairman and CEO, John Surma, covering our second quarter results. President and COO, Mario Longhi will provide an update on various projects and in issues we are pursuing. I will provide some additional details for second quarter. And then Gretchen Haggerty, U.S. Steel Executive Vice President and CFO will comment on a few financial matters and our outlook for the third quarter 2013. Following our prepared remarks, we will take your questions. Before we begin, I must caution you that today’s conference call contains forward-looking statements, and that future results may differ materially from statements or projections made on today’s call. For your convenience, the forward-looking statements and risk factors that could affect those statements are referenced at the end of our release and are included in our most recent Annual Report on Form 10-K and updated in our Quarterly Reports on Form 10-Q in accordance with the Safe Harbor provisions. Now, to begin the call is U.S. Steel Chairman and CEO, John Surma.

Thanks, Dan and good afternoon everyone. Thanks for taking the time to join us. Earlier today, we reported a second quarter net loss of $78 million, or $0.54 per share on net sales of $4.4 billion and shipments of 5.2 million tons. Although our segment operating income decreased from the first quarter due to lower results from our Flat-rolled, Tubular and European segments, it was our sixth consecutive quarter of profitability at the segment level. Now, before I go into more detail on our segment’s operating results, I will comment briefly on safety. We continue to make significant improvements in safety performance, both in the reduction of injuries and the elimination of workplace hazards. The progress has been achieved through the combined efforts of our management team and our production and maintenance employees, and highlights what can be accomplished through the cooperative efforts of our entire workforce. We are working to utilize that same co-operative approach to maximize the results from the major profitability and value enhancement initiative that our President and Chief Operating Officer, Mario Longhi is leading. You will hear from him a bit later. Now, turning to our Flat-rolled operations, we reported a loss from operations of $51 million in the second quarter as compared to a loss of $13 million in the first quarter. The favorable effects from increased average realized prices and lower raw materials costs were more than offset by lower shipments due to planned blast furnace maintenance outages and the ongoing lockout of Lake Erie Works and increased repair and maintenance costs. As we noted in our release, repair and maintenance costs were approximately $30 million higher as compared to the first quarter. This increase was considerably lower than we had anticipated primarily due to the outstanding efforts of our operators and engineers to complete projects on the budget and control spending in all areas at our facilities. Although our shipments decreased as we continue to deal with the Lake Erie Works in our planned maintenance outages. Demand has been relatively stable and many of the value added markets we serve continue to improve. While the recovery in the automotive markets has clearly led the way for other markets such as appliance, agricultural equipment’s and residential construction are also making progress. The combination of improving demand and generally lean supply chain inventory levels has provided support for the improving pricing environments off late. Our tubular segment income from operations was $45 million in the second quarter lower than income in the first quarter as increased shipments which reached levels comparable to 2011 and 2012 on an annualized basis were offset by average realized prices have receded to their lowest level since the first quarter of 2011. The market fundamentals for the tubular products continue to be sound but our margins continue to decrease as a result of the ongoing decline of prices resulting from high import levels including large imported volumes unfairly traded OCTG products. As we have discussed with you in the past we have been working hard to be a supplier of choice to the energy industry since 2010 we have made significant investments in this segment of our business to meet our customer’s needs. We have added important capabilities at our tubular facilities and recently announced another investment in our Lorain Tubular operations which will expand size and range capabilities of our small diameter seamless (inaudible). And we continue to invest resources into the development of new steel grades and products such as proprietary premium, semi-premium tubular connections designed for the specific and exact needs of today’s energy industry and users. However we have not realized the full benefits of our efforts and investments due to the recent surge of unfairly traded imported tubular products. On July 2nd, we filed a trade case with the ITC along with other eight other domestic tubular producers. Again producers from nine countries seeking enforcement that the trade remedy is available under the U.S. Trade Laws for the illegal dumping of tubular products from these countries as well as (inaudible) duties for government subsidies and two of the subject countries. This case is in the early stages of a very complex process with the next critical milestone being a vote by the International Trade Commission on August 16, that would allow this case to proceed and a full investigation to be completed. While this particular case is in the spot light right now this is not a situation that is unique to the energy tubular markets. As unfairly traded imports affect the entire steel industry and many other industries in the U.S. as well. As steel producers around the world scramble to fill their mills the pressure on the U.S. market has intensified. In 2010 to 2012 U.S. imports have flat rolled steel increase by approximately 42% and imports of oil country tubular goods rose by 52% over the same period. This despite the fact that new market driven flat rolled tubular capacity has been added in the U.S. Capacity that would be expected to compete successfully with fairly traded imports, that’s why it's so important that policy makers deal urgently with foreign market distorting practices and the need to strongly enforce fair trade rules. Recognition of the need for more level playing field whether in terms of the behavior of state of enterprises, currency manipulation, enforcement of basic regulatory standards and many other issues seems to be on the risk among the public and the policy makers? We need to leverage this growing (ph) recognition with real steps to address market distortions. We need to maintain strong trade loss and strictly enforce them. We need to ensure that industries do not have to wait years and suffer extensive injury it can cause loss of jobs and negatively impact decisions to invest capital and where businesses in the U.S. before measures can be taken to address proven unfair trade and we need to do a better job enforcing the trade orders we have on the books, addressing attempts by foreign producers to circumvent trade relief. We must also pursue an affirmative agenda to better incentivize market based outcomes and a level of playing field including passing legislation that recognizes and treats currency manipulation as the unfair subsidy that is. If American policy makers are vigilant I believe we can work through the current era of global excess capacity and move forward a new era in which success in the steel industry will be driven solely by hard work, innovation, and real competitiveness. We are already seeing glimpses of what that could be. Thanks to some of the investments we have made in our Tubular operations that I mentioned earlier, and we will continue to do our part to advance our industry even further by using our ingenuity and the termination to discover new process efficiencies and create breakthrough technologies. Now, turning to our second quarter results, for Europe, we reported an operating profit of $10 million in the second quarter, the lower results as compared to the first quarter were primarily due to higher iron ore costs and decreasing spot market prices as the inventory restocking cycle that occurred in the first quarter concluded. Increased shipments in several of our other markets offset a decrease in shipments to service centers, but our volumes remained strong at levels we have not achieved since early 2010. European market conditions continued to be challenging. Demand has not recovered as it has in our North American markets. While in general, it appears that there has been some progress year-over-year. The supply and demand balance remains a significant issue in the pace of any substantial recovery in demand remains uncertain. So, I will turn the call over to Mario to discuss our progress on several important projects we have been pursuing and provide some insight into the profitability and value enhancement initiative he is leading. Mario?

Thank you, John. We are not contempt to wait for further global economic recovery to improve our results. We are deepening the focus on areas that we can control with the objective to position our company to deliver the best results possible regardless of market conditions. In pursuit of that objective and beyond the already completed strategic projects, we are evaluating future opportunities all intended to improve our cost structure, operating efficiency, reliability, and financial performance, and to support our customers continually evolving needs for more highly engineered and advanced steel products. Last quarter, John discussed our North American Flat-rolled projects relating to our Carbonyx strategy, specifically the ramp up of our new coke battery at our Clairton plant, and the first of our two Carbonyx modules at Gary Works. Our efforts to enhance our yields at our Minntac ongoing operations and the potential for the production of the DRI grade pellets and the successful startup and commissioning of our state-of-the-art continuous annealing line at our Pro-Tec Automotive joint venture. In our Tubular segment, in addition to continuing our premium connection of development efforts, we are pursuing the project to expand the capabilities of our small diameter at our Lorain facility that John mentioned earlier on today’s call, also the potential for the joint venture DRI project with Republic Steel at Lorain. Our operators and engineers continued to advance these projects as planned, and we are confident that the anticipated benefits from these projects will be more fully realized as they are completed. Last quarter, John also gave a brief introduction to a major strategic initiative that I have been charged with leading. And I would like to discuss this initiative and how we intend to reach our objectives in a bit more detail today. We are referring to this as a profitability and value enhancement initiative as it is much more than just a cost-cutting exercise. As we have indicated, we are approaching this with same type of total organizational effort that we have used to produce our outstanding achievements in our safety performance. But in this case, our timeframe for achieving meaningful results has to be much shorter. Our people are referring to these initiatives as part of Carnegie reflecting the business spirit in which the company was originally created, and the fact that we will not compromise our core values in pursuit of this initiative. This project is designed to critically evaluate what we do and how we do it. The goal is to leverage small projects and ideas across the operating locations while hunting for larger transformational changes. Sustainability is the key. The changes are expect to be a new way of operating and doing business and not short term measures that revert back over time. The goal is to be able to sustain these improvements on an ongoing basis and under all market conditions. Improvement are expected from both the cost and the revenue side of the equation. We’re focusing on four key pillars of potential opportunity, raw materials which make up about 2/3rds of our product cost structure, conversion costs across all facilities, fixed cost including SG&A and revenue. Enhancement by reevaluating market strategies. This is a major undertaking and we’ve established a detailed and structured process to provide a discipline and focus required for a successful outcome. We have formed teams of functional experts whose mission is to develop and execute on ideas within their areas of expertise. We have also formed teams at each operating location whose responsibility is to develop and implement site specific ideas for ideas that can benefit multiple operations as well as to execute project ideas from the functional teams. By having leadership both vertically and horizontally through the corporation and metrics we will better ensure collaboration and facilitate execution by requiring that our team identify commit to and track specifically defined projects we will help ensure greater focus and ultimate success. And our challenge is with this initiative, it is not a short term cost cutting exercise, it requires everyone to think different, think big and accept change. We do not want to limit the thinking and creativity of our teams by discussing specific targets set aside. Our costs and revenues are in the billions of dollars annually and small percentage of change on either side would be very meaningful to our results. We understand that that we must not only deliver results, but also communicate our achievements in the markets in order to have the translate and add real value for our stakeholders, and we will provide updates as projects are completed and our achievements are firm. Now let me turn it over to Dan for some additional details on the first quarter.

Thank you Mario. Capital spending totaled 1.5 million in second quarter and we currently estimate the full year capital spending will be approximately 710 million. Appreciation, depletion and amortization totaled $170 million in the same quarter and we currently expect it to be approximately $685 million for the year. Pension and other benefits costs for the quarter totaled $110 million and we made cash payments for pension and other benefits of $88 million. We expect pension and other benefits costs to be approximately $440 million in 2013 and we expect cash payments from pension and other benefits to be approximately $550 million for the year, excluding any voluntary pension contributions. Net interest on the financial costs were $65 million for the quarter, excluding a $3 million unfavorable foreign currency effect from the remeasurement of a U.S. dollar-denominated intercompany loans. We expect net interest and other financial costs to be similar in the third quarter excluding any foreign currency remeasurement gains or losses. Now Gretchen will cover some additional items and our outlook for the third quarter.

Okay. Thank you Dan. In the second quarter our cash flow from operations was $151 million. After deducting our cash used in investing and dividends we had free cash flow of $32 million. Looking at the last 12 months we have remain disciplined in our spending, managing our capital programs in line with our ability to generate cash from our operations. We ended the second quarter with $767 million in cash and had total cash and available liquidity of just under $2.5 billion. Now let me turn to our capital structure, in July we extended the maturity date with two separate liquidity facilities, one secured by domestic accounts receivable and the other are unsecured revolving credit facility in Slovakia, the two facilities provide a combined total 885 million of liquidity for the corporation. The principal value of our accounts receivable facility remains 625 million. The three year facility which was to expire in July of 2014 is now scheduled to expire in July of 2016. The USSK facility, which was set to expire next month remains at €200 million and will now expire in July of 2016. With the completion of these expansions, we have total corporate liquidity facilities of over $1.7 billion committed through the middle of 2016. They are all currently un-drawn. So, given our cash and liquidity positions, we feel comfortable with our current maturity schedule with less than $600 million in debt maturing through 2016. Now, let me turn to the outlook for the third quarter. Our results for our Flat-rolled and Tubular segments are projected to improve compared to the second quarter. However, we expect low results from our European segment due to a planned blast furnace outage in the third quarter. Operating results for our other businesses are expected to decrease compared to the second quarter to near breakeven. Total reportable segment and other businesses results are expected to be comparable to the second quarter. Turing to Flat-rolled, we expect our Flat-rolled segment results from operations to improve based on an increase in average realized prices, lower raw material costs, and lower repair and maintenance costs partially offset by reduced shipment. Average realized prices are expected to increase compared to the second quarter due to increased spot market prices as well as a more favorable product mix. Our shipments are projected to decrease significantly due to a blast furnace outage at our Great Lakes Works and Lake Erie Works labor dispute. The represented employees of Lake Erie Works are scheduled to bode on the company’s contract offer on July 31, 2013. If the contract is approved, we plan to restart operations as soon as possible. This outlook does not include any effects of the restart of Lake Erie Works. Our third quarter results for four European segment are projected to decrease compared to the second quarter. A scheduled blast furnace outage will result in significantly lower shipment and increased facility and repair and maintenance costs. Average realized euro-based prices are expected to be lower compared to the second quarter as decreases in spot and contract market prices are partially offset by the positive effects of a higher percentage of value-added shipments. Raw material costs are expected to be lower in the third quarter due primarily to the lower iron costs. And we expect third quarter results for our Tubular segment to improve compared to the second quarter. Shipments are expected to increase to support anticipated drilling activity and average realized prices are projected to be comfortable. Our operating costs in Tubular are expected to decrease due to operating efficiencies from higher production volumes. From July 1, 2013, we entered into a supplier contract dispute settlement agreement. As a result of the agreement, we do expect to record a pre-tax gain of $23 million, which we will report as an item not allocated to segments in the third quarter of 2013. We expect a minimal tax provision or benefit in the third quarter, primarily due to the full valuation allowance on deferred tax assets in Canada. So, that is for the outlook. I will turn it over to you, Dan.

Thank you, Gretchen. John, can you please queue the line for questions?

(Operator Instructions) In the line was Michelle Applebaum with Michelle Applebaum Research. Please go ahead. Michelle Applebaum - Michelle Applebaum Research: Philosophical question as you embark on this athlete named Carnegie program, I would like John and Mario, both in particular to request on why it has been over my 30 odd years following this industry. I have only got two companies that I worked with that are in the melting business that did not go through a major re-org and usually those were Chapter 11, those were Nucor and U.S. Steel I think we all know why Nucor has survived and flourished for the last 30 years but can you talk to me about what U.S Steel different and why U.S. Steel sort of the last living or last not reorganized integrated steel maker in the U.S. and what kind of future lessons can we draw from that?

It's a philosophical question Mitchell I will just give you a couple of thoughts not sure I will do justice but first and foremost I think are company is still here because we have had very, very strong people in the leadership of the company and the myself in that but I think we had good people at the leadership company who thought long and who were appropriately conservative at appropriate times. We believed in funding our pension plan, we believed in investing in our facilities and that is stood us well overtime and we do have some legacy benefits that we carry certain of our annual resources will be among those, we have some legacy obligations we carry as well but there are things that we have tried to treat seriously and deal with properly and do the right thing to ensure our long term vigor and long term prospects for the company. So I think I’ll just summarize it by saying we have been fortunate to have leaders in the company that have taken a long term view and have done the best thing for the company over the long term and with an expectation over the long term that’s going to trend into a light shareholder value. I can’t comment on what everybody else do that’s not our business and our issue but from our standpoint we look at the long term benefit for the company of doing the right thing and that’s the way we have done it for 112 or 113 years now. My expectation is that we will do that way for a long time to come.

I couldn’t have articulated any better than John just did, Mitchell and with the intent of creating successful future for us is purpose behind Project Carnegie . Michelle Applebaum - Michelle Applebaum Research: Then my next question can we talk a little bit about the OCTG case, there seems to be some confusion over critical circumstances and what that means and the timing of the impact, et cetera, so can you get into some of that?

Sure I think just in general I will point out that the case was filed just recently. It's a large complex case it's probably going to take a year or more would be what I think that experts would say first the important milestone comes up in a couple of weeks I think as I mentioned in my comments in mid-August and then there is assuming the case proceeds with full investigation as checkpoints along the way where duties will begin to be assessed and then sometime a year from now or so there will be a final determination. But critical circumstances and this is fairly our trade law so I will just give you my simple understanding of it. Critical circumstances can be alleged any time during the tendency of the process. If we happen to see surge of imports we can allege that matter at any time upto I think 21 days or so before the final determinations if the allegation then it would be successful they would duties imposed and if you go back I think 90 days even before the preliminary determinations which be quite way back so we can do that and we won't hesitate to if we believe that’s appropriate but that’s the current status of that matter, that’s a trade law matter but that’s not the best understanding of it.

Our next question is from Evan Kurtz with Morgan Stanley. Please go ahead. Evan Kurtz - Morgan Stanley: Just a less philosophical question maybe in terms of the rate, firstly you’ve this contract coming up for vote at Lake Erie maybe some guidance on what that would impact cost if there were to, to go through how quickly get your ramp up there and what would that mean?

:

Right. And then I think that summarizes it all. Evan Kurtz - Morgan Stanley: Okay, thanks. And maybe just one on pensions, and over the past years you have built up a nice cushion from excess contributions, I am wondering if you are burning through that at this point, I think it’s the cash contributions are at the $550 million range here. Is that burning through that cushion and is there some possibility out there potential that we should be aware of where you could actually see a step up to a mandatory payment in the next couple of years assuming kind of things move along at that $550 million level?

Sorry Mario.

Go ahead.

I mean, we have been making contributions of about $140 million now for some time. And is that little bit more than our normal cost, so that it’s a good amount to be funding. I think that we have had in our other 10-Qs of disclosure that because as long as we continue at that $140 million rate, we shouldn’t see higher required mandatory contributions for a couple of years even if the lower rate up today persist. So, we have done some kind of stress testing on that. And so I think we have a couple of years, if rates remain unchanged at these very low levels, where we would still just being able to make that. No, it would ramp up back to that if rates continue lower for longer or there is some big disruption in the market. We don’t earn our expected rate of return, but I think our long-term strategy of funding on a regular basis has served us well. So, I think there is others that have a much more immediate effect than it would.

Our next question is from Sal Tharani with Goldman Sachs. Please go ahead. Sal Tharani - Goldman Sachs: Thank you very much. Good afternoon.

Hi Sal.

Hi Sal Sal Tharani - Goldman Sachs: Hey, I was running this sort of plant idling cost of $70 million at Hamilton and Lake Erie, can you break it down between the two how much was in Hamilton?

Well, I think we have sort of given those numbers on and off over the years. I don’t have the details right in hand maybe Dan could help with that, but on an ongoing basis, there is more significant issues involved just like Erie. We have had the Hamilton carrying in our results for some time and I’ll have to let Dan back to you on those numbers, if that’s okay Dan.

Sure. No problem.

Sal, is that okay? Sal Tharani - Goldman Sachs: Thanks. We can, going forward, if Lake Erie comes back, we can have an idea what to model in. And you mentioned in your press release about the strategic program on the OCTG side, can you just elaborate on that, is that a fixed price contract or how does it work and what is the length of these contract is?

I am sorry Sal I misunderstood.

Sal, I am sorry. Sal Tharani - Goldman Sachs: You have this in the press release you mentioned that your volume was higher because of the you sold it to your strategic program customers.

Oh, I see. Sal Tharani - Goldman Sachs: What are included in that program and what are prices and what is the length of these contracts?

Yeah, they are not of extraordinarily long duration. They are usually for a period of year or two or three, and they vary by major the pricing is normally negotiated on a monthly quarterly basis something like that. And what really it represents is an agreement between we and our program customers with working a capacity with them, the extent they have need for that, they will buy up to that volume from us. And that is what got extremely well. It represents a significant portion of our volume. I want to swing on our OCTG volume. It was not quite 60%, but above 50% of total volume last quarter. So, it’s not a take or pay or anything like that, and it does have negotiable pricing over time. It’s more us and I am agreeing that we got capacity they have needs and we try to make sure those two things line up.

Our next question is from Dave Katz with JPMorgan. Please go ahead. Dave Katz - JPMorgan: Alright. I was looking to get a little bit more color on the liquidity, it declined quarter-over-quarter your cash went up and I was just trying to drill down a little more and they are perhaps looking at the three components.

I think that probably is if you look in our disclosures you will see that we actually have a liquidity block. We do have a fully loaded fixed charge coverage ratio in the liquidity facilities and the effect of it is, is that we have to leave 87.5 million undrawn if we don’t meet that covenant and so we reduce our liquidity by that amount. That’s still what it reflects. The facilities are undrawn so I mean it's kind of a theoretical calculation at this point. Dave Katz - JPMorgan: Okay and then looking at the CapEx obviously it's backend weighted this year. Next year do you have any clarity on what the number of, can you look like in the timing of it?

Little early for that.

Yeah not really, we’re just in the conceptual phase and looking into projects and things will have to be done some of which are more infrastructure, some of would be more strategic and opportunistic. We have had a policy as I think we have articulated and living within our means and to some extent that will be what guides us next year in terms of total value, a wishlist that we can look forward to likely going to be something else. And we have managed find room for some strategic things that are important to us to tubular and carbon strategy et cetera. So I would say that if you’re going to use a number maybe the existing outlook we have given place to start and this might vary up (inaudible).

And next go to Gordon Johnson with Axiom Capital Management. Please go ahead. Gordon Johnson - Axiom Capital Management: What seems to be an unprecedented move by AK Steel, still didn’t announce a price ceiling on the increases they've announced well is the pretty big differentials and HRC spot prices, flat fee a 178 above U.S. and China, $94 above U.S. on the spot market. Have you guys seen an risk to significant declines in HRC spot pricing in the back half of this year and then secondly with respect to the trade case do you see any potential dumping from a Korean players and others ahead of a potential decision there that maybe weighing on your tubular business that was somewhat weak versus what you were guiding. Thanks a lot.

I will catch those, let me take the latter first on tubular and of course they are very, very high. The trade case was filed just recently, I don’t know that we have any particular evidence either or anecdotal or systemic that will unless if there is a surge coming but my earlier answer of critical circumstances would apply if that would be the case we know how to deal with that then and the fact is we’re in a surge already that’s why we filed the case and if there is a change in that we will be able to that when the tide comes. On the hot rolled pricing we’re on pricing we're on pricing just get pricing in general from a North America reference point. The figures that you mentioned I mean there different analysis on those but I mean on the ball park you’re I think probably on the right side of things, some of them flexi (ph) countries we have a suspense agreements and then we also have to consider whether products coming from South Asia have VAT on them and whether it rebatable and the currency movements but in general that spread is lined up, there is no doubt about that and of course the best way to have that aspect close is to have little prices move up particularly in Europe but what happens remains to be seen. It's will be impossible for us to say that there is no risk because history tells us that there is and the wider it gets the more the risk but I would also emphasize that the risk gets much higher when there is not reasonably good domestic availability for our customers and that's why we are here. And I think our customers are reasonably well supplied at this point and we’re doing the best we can running highly utilization rates of what we have available. :

No your guess is as good as mine.

And next go to Timna Tanners with Bank of America. Please go ahead. Timna Tanners - Bank of America: Yes, hey afternoon.

Hi Timna.

Hi Timna. Timna Tanners - Bank of America: So, my first question is really about this year’s CapEx just because the trend so far is much lower than the run rate that you have reiterated at $710 million, so can you give us a little bit of color about what’s going to be driving more back end loaded CapEx please?

I think Timna, it just has to do with how our projects are unfolding. We are doing some detailed engineering work on it. And we did – we have been managing our capital pretty closely and so that if you start that early in the year you can manage it and you are going to probably end up spending more later in the year than early in the year when you are doing it. So, I don’t think it’s really anything more than that. We had a higher expectation at the beginning of the year for capital budget is what $100 million. And so we are down to $700 million, that it’s really just sort of managing to that level and we will be spending what we spend, when we spend it. Timna Tanners - Bank of America: Got you. Okay. So, to follow up on that, then I am really is does that mean that you could still lower it and can you remind me of the timing of some more specific projects, Mario, just going through it, I just wasn’t clear on when we are going to see some of the benefit like from the Kobe joint venture rolling off, that’s already playing out and what the timing is of that Tubular ramp up of the greater project capability or product capability? Thanks.

If you want to count on it Mario, I think some of those are already up and running.

The TA line actually is already up and running and we have gone through a very, very substantial startup in qualification of products. We have already received a couple of orders that are beginning to come in. And I believe it will take the last potentially of this year for us to begin to see a more significant volume going through the facility, but the progress really, really good. In Lorain, our Tubular project it’s still in the engineering phase. So, there is going to be quite a bit of that going on before any actual construction starts. So, it’s going to be for next year. Timna Tanners - Bank of America: Did you say if it will but cut further?

Pardon me. Timna Tanners - Bank of America: That is one of the projects we are going forward with. I think he was saying it would be since that’s just under engineering now that the spending would be, there would be more spending next year on that?

Yes, the actual construction of that, actually at least taking a look at the risk and you go, it’s actually going to be installed. So, a number of things that actually just increased the capability of the mill in terms of the size, range, and horsepower and all that, so it’s not a new building or anything like that. And as Mario says his colleagues are just, our colleagues are going through the engineering process right now. Before they actually get around to doing the real construction project that will be in the next year and so we ballpark that project I think at $100 million plus or minus and more of that probably next than this year, but we still afford to have it up on schedule and contributing significantly to our Tubular results we hope next year.

And next we’ll go to David Gagliano with Barclays. Please go ahead. David Gagliano - Barclays: Hi. I just wanted to focus a little bit on the Sal question effort just a couple of quick questions. When should we expect to hear a more definitive plan about the efforts about quantifying the potential the value creation opportunities here, what kind of timeline should we be looking for, that’s my first question?

Well, it just started and we are well structured as I mentioned before to engage everybody on the organization to pursue a more optimal manner in running the business. And therefore this is going to be a continuing and what we would like to do really is begin to bring to your attention the products that are concluded when we see the firmness of the results and we can explain with you why coming to the bottom line. David Gagliano - Barclays: Okay, does this value creation plan include potentially closing and or divesting some operations or assets?

We have an effort going on in order to assess the real capabilities available logistics is a big part of that kind of analysis. So, everything is on the table at this point and we will assess every one of them. David Gagliano - Barclays: Okay, thanks.

And we will go to Luke Folta with Jefferies. Please go ahead. Luke Folta - Jefferies: Hi good afternoon everybody.

Hi Luke.

Hi Luke. Luke Folta - Jefferies: I guess my question just again on the improvement plan have you done anything and is there anything the kind I guess better align the employees motivation in terms of coming up with these sort of improvements, as there has been any changes to kind of the incentive plan or anything along those lines?

Yeah. That certainly one of the items that is inside of this revaluation of our running the business. There will be a very direct correlation in the way that we will link goals performance and incentives.

But right now we have had programs that are tied to our rosy (ph) performance and that effects all of our employees and management employees. Luke Folta - Jefferies: Is that something you think you could do in I guess in the context of the current labor agreements that are already in place?

Well. I think its much more difficult in terms of it's not customary in terms of the bargaining unit agreements to make some changes like that although I would say inside our existing programs we have excellent alignments and when we look at the same numbers whether it's profit sharing, the management plan or the executive plan, we all have the same numbers there is no confusion about that. But I also think that inside the represented unit agreements that we've got sufficient flexibility to continue to improve productivity within the agreements that we have and we've had good success with this type of agreement since we first came into effect in 2003. So I don't know that we see that as a limiting factor in any particular way.

And our next question is from Brian Yu with Citi. Please go ahead. Brian Yu - Citigroup: The first question is just with the European market you mentioned that prices there haven't been still great. But I think in recent weeks there have been some price increase announcements. So I was wondering if you could share any thoughts or your views on this, much of that has gain traction?

Little early to tell. You're quite right. I think there has been some activity including our company and we're having those discussions with our customers right now. A little soon for us to pronounce that one way or the other I think its always the market is going to decide. But we're seeing with the supply demand balance as it is, and we're getting through the holiday period and back to what might be able to a busier time if there might be some opportunity. So we're sort of going to see what the market will provide but we're just in the middle of discussions right now. Mario anything you want to add any different to that?

No it's actually vacations have filled couple of weeks ago before normal levels of activity picked back up. I think in another couple of weeks we probably have a better idea what impact of this improved level activity will mean. Brian Yu - Citigroup: Okay and my second question is I know Project Carnegie it sounds like it's going to be more ops driven. I was wondering maybe from this client side there has been some MLPs out there who are talking about try and get into the iron ore or coke business and I was wondering if that something that you guys have looked into to try enhance the value of some of your assets by either dropping them or selling to MLPs?

Yeah. I mean we've looked that what I would call kind of complex tax oriented structures of that type before, we in fact at one point had a partnership of our coke oven batteries, three of our coke oven batteries had (inaudible) works that it was a different structure but tax oriented and beneficial at the time. But the thing that we have to think about and looking at our coke assets and our iron ore assets is we basically consume everything that we make there. And the MLP structures are really designed what kind of growth assets where you're going to be dropping things in over time. And when you have a strategic need for that particular product I mean its part of our raw materials it turns the structure into a more of a financing for us. Okay. And so while we look at, we have looked at those things and we certainly have done complex transactions in the past. It may not be the best thing for the most cost effective thing for our company, just given the strategic nature of those assets. I mean we will keep looking at those things and looking for things that will provide more value to our company. But we've tried a number of things on that front. In the past and it's hard to escape from meeting the material I mean we were long on those assets, we have a long product there. We looked at that at one point there many years ago when we were long.

Our final question from the line of Aldo Mazzaferro with Macquarie Equities Research. Please go ahead. Aldo Mazzaferro - Macquarie Equities Research: Hey John as you go forward on these trade cases. Even if they get into flat rolled and let’s say the statement of OCTG (ph) and I know you basically suffering – some illegal traded imports but do you think you’re actually raising prices like this on the are high level coal price – I think it has gone up $100 a tonne or more, and actually starting to get success in the market. Do you think that in some cases like weaken your arguments on the trade case, so then step in (ph) on the trade case?

No. I think conceptually no and factually no. Aldo I think the extent that the domestic market its active competitive position generates a certain level of prices that's all well and good that's the way the system should work. If there are illegally done imports whether it's when domestic prices are low which is not unusual or higher we think that the injury is the same. I think we think there our company and other likewise are injured just the same one way or the other and we wouldn’t see the effect on our company any different that’s money that's out of our shareholders pockets and into somebody in some foreign place that we can’t pronounce. So we don't think it that makes a difference. We think we should pursue a level of playing field and other country should live up to their trade obligations just like we do regardless of what local market conditions are. So, I think that would be the best answer I can give on that. That's not to say that higher prices can't encourage fair trade and that's okay we'll compete, we’re prepared to compete on a fair trade basis, that's why we think we've got pretty competitive position. Aldo Mazzaferro - Macquarie Equities Research: Hey, John as a follow-up. I wonder could you comment on how many products you might may have approximately (inaudible) on the initiatives at the possibly with the DRI, EAF (ph) whether it's on marine or other ideas you might have on that?

Well, we're very active in that arena. Aldo, we do have already a project in place been analyzed so that we can evaluate the possibility of making DRI quality pellets and bring it down eventually, move it into a EAF and begin to diversify a better footprint. So that's really ongoing.

And we do have the mentioned the as Mario mentioned the pellet project that are, it's like little down where we need to be. And that's underway and we'll hear more about that later this year we hope. But then also we have a joint study project underway now with our neighbors at Lorain probably Steel for who is building (inaudible) for DRI project there and that combined with our potential -- that's a pretty powerful and very cost effective combination that would get us really, really competitive round source into Lorain and maybe some other places. So we also I think have considered internally and have had some early discussions with others about DRI elsewhere whether its together, joint, separate the economics of $3 or $4 gas or $5 gas, and our DRI grade pellets is really substantial and we have given some numbers out before on that. So it's something we find very attractive and getting that into our production footprint is something that I think we all agree on is something really good for the company. So we think it's a really good thing.

Well. I think we like to thank everybody participating. We appreciate your interest and we look forward to talking to you again in October. Thank you.

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