The company plans to use the proceeds to reduce its debt.
Cliff Natural Resources chairman, president and CEO Lourenco Goncalves said: "This transaction is another important step in executing our strategy to transform Cliffs into a stronger, pure-play US iron ore supplier."
The Oak Grove mine, Cliffs’ coal asset in Alabama, and Pinnacle mine in West Virginia will have no impact with this transaction.
Cliff is also considering options to sell its other coal assets.
Subject to customary regulatory approvals, the sale to Coronado Coal II is expected to be concluded by the end of this year.
Cliffs expects the transaction to result in a loss of around $425m in the fourth quarter of 2014 on pre-tax basis.
Deutsche Bank Securities and and Hahn Loeser & Parks were financial advisor and legal advisor to Cliffs Natural Resources for the deal.
