**Exhibit
99.1**
 
 **Algoma
Steel Inc.**
 
   
 **Annual
Information Form**
 **Dated
March 24, 2005**
        
   
  
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 
 **DESCRIPTION
      OF BUSINESS**
    
    
    **1****INCORPORATION**
    
    
    **1****CORPORATE
      STRUCTURE**
    
    
    **1****DEVELOPMENT
      OF THE BUSINESS**
    
    
    **2****BUSINESS
      OF ALGOMA**
    
    
    **3****NORTH
      AMERICAN STEEL INDUSTRY**
    
    
    **3****PRODUCTS
      AND MARKETS**
    
    
    **4****COMPETITION**
    
    
    **5****MARKETING
      INITIATIVES**
    
    
    **6****TRADE**
    
    
    **6****STEELMAKING
      FACILITIES**
    
    
    **7****RAW
      MATERIALS AND ENERGY**
    
    
    **8****ENVIRONMENT**
    
    
    **8****EMPLOYEES**
    
    
    **9****DEBT
      INSTRUMENTS**
    
    
    **9****LEGAL
      PROCEEDINGS**
    
    
    **9****RISK
      FACTORS**
    
    
    **10****DIVIDEND
      POLICY**
    
    
    **16****CAPITAL
      STRUCTURE**
    
    
    **16****DIRECTORS
      AND EXECUTIVE OFFICERS**
    
    
    **16****MARKET
      FOR SECURITIES**
    
    
    **19****TRANSFER
      AGENT AND REGISTRAR**
    
    
    **19****INTERESTS
      OF EXPERTS**
    
    
    **19****ADDITIONAL
      INFORMATION**
    
    
    **19**
 
 Unless
otherwise stated, all dollar amounts referred to in this Annual Information Form
are in Canadian currency.
 
 Certain
statements in this Annual Information Form are “forward-looking statements” that
reflect the expectations of management regarding the Company’s future growth,
results of operations, performance and business prospects and opportunities.
These forward-looking statements reflect management’s current expectations
regarding future events and operating performance and speak only as of the date
of this Annual Information Form. Forward-looking statements involve significant
risks and uncertainties, should not be read as guarantees of future performance
or results, and will not necessarily be accurate indications of whether or not
or the times at or by which such performance or results will be achieved. A
number of factors could cause actual results to differ materially from the
results discussed in the forward-looking statements, including, but not limited
to, the factors discussed under “Risk Factors”. Although the forward-looking
statements contained in this Annual Information Form are based upon what
management believes to be reasonable assumptions, investors cannot be assured
that actual results will be consistent with these forward-looking statements,
and the differences may be material. These forward-looking statements are made
as of the date of this document and neither the Company nor its management
assumes any obligation to update or revise them to reflect new events or
circumstances.
 
   
   Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Description
of Business**
 
 Algoma
Steel Inc. (“Algoma” or the “Company”) is an integrated steel producer located
in Sault Ste. Marie, Ontario and is Canada’s third largest integrated steel
producer, accounting for approximately 14% of Canadian raw steel production.
From its location in Sault Ste. Marie, Ontario, at the hub of three Great Lakes,
the Company is well positioned to access the extensive steel markets within a
400-mile radius of its plant. In 2004, the Company produced approximately 2.5
million tons of raw steel and shipped approximately 2.2 million tons of finished
products, primarily via rail or truck. Algoma’s principal product is sheet that
represents 81% of Algoma’s 2004 shipments, with plate products accounting for
the balance. The principal markets for Algoma’s products are steel service
centres, the automotive industry, steel fabricators and manufacturers. Virtually
all of Algoma’s production is sold in Canada and the United States, with
approximately 24% of its steel sales to customers in the United States in
2004.
 
 The
registered and principal office of Algoma is located at 105 West Street, Sault
Ste. Marie, Ontario P6A
7B4.
 
 **Incorporation**
 
 Algoma
was incorporated under the laws of the Province of Ontario by Articles of
Arrangement (the “Arrangement”) dated June 1, 1992. Pursuant to the Arrangement,
Algoma acquired all of the assets and assumed certain liabilities of its
predecessor company, The Algoma Steel Corporation, Limited, that conducted a
business originally established in 1901. On January 29, 2002, the Company’s
articles were further revised pursuant to a Plan of Arrangement and
Reorganization (the “Reorganization”).
 
 **Corporate
Structure**
 
 The
following chart details the intercorporate relationships between Algoma and its
principal subsidiary companies and their jurisdiction of incorporation or
organization as at December 31, 2004. Both subs idiaries
are presently inactive.
  
 
  1
   Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Development
of the Business**
 
 On
April 23, 2001, the Company filed for court protection under the Companies’
Creditors Arrangement Act (“CCAA”) to allow for the development of a
restructuring plan. A reorganization was implemented on January 29, 2002 which
restructured the Company’s long-term debt and equity interests and included a
revolving credit facility totaling $180 million. The Reorganization also
resulted in reductions in labour and interest costs.
 
 In
January 2002, Algoma’s U.S. subsidiary, Cannelton Iron Ore Company
(“Cannelton”), completed an agreement with Cleveland Cliffs Inc. (“Cliffs”) to
transfer Cannelton’s 45% interest in Tilden Mining Company L.C. (“Tilden”) in
exchange for the assumption by Cliffs of Cannelton’s share of Tilden’s
liabilities and no cash consideration. As part of this arrangement, the Company
has entered into an exclusive 15-year supply agreement with Cliffs for a minimum
annual supply of 2.5 million tons of iron ore.
 
 The #7
Blast Furnace was relined in 1995 and is tentatively scheduled for the next
reline in 2010. The Company is following a comprehensive program developed by
Company personnel and a global engineering firm involving certain repairs and
upgrades between 2005 and 2010 at a cost of approximately $52 million. The
program includes the completion of upgrades in 2006 over a scheduled 35-day
outage. The estimated cost of the reline in 2010 is approximately $120 million
and requires an outage of about 90 days. The Company expects to operate its
smaller #6 Blast Furnace during the reline to support continued production on
the DSPC.
 
 On
September 3, 2003, the Company entered into a new four-year revolving credit
facility with a syndicate of four banks. The $200 million facility is secured by
inventories and receivables and is subject to a borrowing base as determined by
the agreement. The new facility resulted in increased availability and lower
costs with no financial covenants until unused availability is less than $50
million. The Company is required to maintain minimum availability of $25
million.
 
 The
Company’s priority in late 2002 and through 2003 was to strengthen its balance
sheet while building an effective and efficient organization by initiating an
accountability-based culture and optimizing the organizational structure. There
was also progress realized in reducing the operating costs and improving the
effectiveness of the commercial activities. Liquidity was further enhanced in
early 2004 as the Company completed an equity issue of 10 million shares
resulting in net proceeds of $81.9 million.
 
 The
Company benefited from strong steel markets in 2004 and this factor, combined
with continued cost control, resulted in strong cash flow and cash and
securities balance at year-end of $453 million. In 2005, the Company intends to
maintain a focus on margin improvement opportunities while exploring a broad
range of strategic opportunities that support value creation and long-term
sustainability.
 
   2
   Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Business
of Algoma**
 
 **North
American Steel Industry**
 
 Total
raw steel production in North America was 145 million tons in 2004, up from 138
million tons in 2003. The United States, Canada and Mexico accounted for 75%,
12% and 13% respectively. Canada has been a net importer of steel since 1997 and
a net exporter in the six years prior to 1997. The majority of Canadian export
production has historically been sold in the United States. The purchase and
sale of North American steel is customarily based on prevailing prices in the
U.S. market denominated in U.S. dollars. Accordingly, a key factor in the
relative competitive position of Canadian and U.S. producers is the
Canadian/U.S. dollar exchange rate.
 
 The
Company currently accounts for approximately 14% of the steel produced in
Canada. Demand for steel in Canada is distributed across a number of processors,
manufacturers and end-users, with the automotive industry being the largest
overall end-user of steel in Canada. The largest direct purchaser of steel is
the service centre segment that acts as a product supplier to a number of
end-users, primarily in the fabricating, manufacturing and automotive
sectors.
 
 The
steel industry is cyclical in nature as indicated in the following table that
sets out summary data with respect to steel shipments and consumption in
Canada.
 
 **Year
      ended December 31,**
    
    **2004**
    
    **2003**
    
    **2002**
    
    **2001**
    
    **2000**
    
    **1999**
    
    **1998**
    
    **1997**
    
    **1996**
    
    **1995**(thousands
      of net tons)Total
      shipments from Canadian producers
    
    
    16,289
    
    
    16,394
    
    
    16,605
    
    
    15,657
    
    
    16,446
    
    
    16,482
    
    
    15,496
    
    
    15,981
    
    
    15,576
    
    
    14,699Exports
    
    
    5,943
    
    
    6,045
    
    
    6,136
    
    
    5,063
    
    
    5,531
    
    
    5,234
    
    
    5,207
    
    
    5,253
    
    
    5,304
    
    
    5,108Imports
    
    
    8,876
    
    
    6,861
    
    
    6,959
    
    
    6,132
    
    
    8,710
    
    
    6,748
    
    
    7,425
    
    
    6,291
    
    
    3,972
    
    
    4,082Apparent
      steel consumption
    
    
    19,222
    
    
    17,210
    
    
    17,428
    
    
    16,726
    
    
    19,625
    
    
    17,996
    
    
    17,714
    
    
    17,019
    
    
    14,244
    
    
    13,673
 
 
 
  3
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Products
and Markets**
 
 The
Company has streamlined operations over the last several years to focus on two
principal product lines - sheet and plate.
 
 ***Sheet***
  The
Company produces sheet that is sold as hot-rolled coils, cut-to-length product,
cold-rolled coils and first-stage blanks. In 2004, sheet represented
approximately 81% of the Company’s shipments. In 2004, 1.6 million tons were
produced on the DSPC which has the capability to produce hot-rolled sheet in
thicknesses from .040” to .625” and in widths from 31” to 63”.
  The
major end-users of sheet products are the automotive industry, welded pipe
manufacturers, hollow structural product manufacturers and the light
manufacturing and transportation industries.
 
 ***Plate***
  Algoma’s
plate products consist of various carbon-manganese high-strength, low-alloy
grades that are produced in either the as-rolled, normalized or quenched and
tempered form. Plate widths vary from 32” to 152” and in thicknesses from 0.188”
up to and including 3.5”.
  The
major end-user of plate is the fabrication industry in either the construction
or manufacture of railcars, buildings, bridges, off-highway equipment, storage
tanks, ships and large diameter pipelines.
 
 ***Revenue
by Major Product Line***
  In
2004, approximately 75% of the Company’s steel sales were made in Canada,
approximately 24% in the United States and the balance mainly in Mexico. Total
revenue for each of the Company’s major product lines for the last three years
was as follows:
 
 **Year
      ended December 31,**
    
    **2004**
    
    **2003**
    
    **2002**(millions
      of $)
    
    $
    
    $
    
    $North
      AmericaSheet
    
    
    1,286
    
    
    848
    
    
    917Plate
    
    
    450
    
    
    262
    
    
    215Other
    
    
    67
    
    
    28
    
    
    361,803
    
    
    1,138
    
    
    1,168United
      States included above (principally sheet products)
    
    
    427
    
    
    242
    
    
    251Mexico
      included above (principally plate products)
    
    
    25
    
    
    10
    
    
    7
 
 
   4
   Algoma
      Steel Inc.
    Annual
      Information Form
 
 The
distribution of total steel shipments by principal market for each of the last
three years was as follows:
 
 **Total
Finished Steel Shipments by Major Markets**
 
 **Year
      ended December 31,**
    
    **2004**
    
    
    
    **2003**
    
    
    
    **2002**(thousands
      of net tons)
    
    Tons
    
    %
    
    Tons
    
    %
    
    Tons
    
    %Steel
      service centres (1)
    
    
    1,251
    
    
    57
    
    
    1,202
    
    
    55
    
    
    1,247
    
    
    58Automotive
      including transportation
    
    
    380
    
    
    17
    
    
    452
    
    
    21
    
    
    377
    
    
    18Fabricating
      and manufacturing
    
    
    205
    
    
    9
    
    
    168
    
    
    8
    
    
    140
    
    
    7Pipe
      and tube manufacturing
    
    
    362
    
    
    17
    
    
    348
    
    
    16
    
    
    372
    
    
    17Total
    
    
    2,198
    
    
    100
    
    
    2,170
    
    
    100
    
    
    2,136
    
    
    100
 (1)
    Management
      believes that the Company’s shipments to service centres were
      predominantly resold to the automotive and the fabricating and
      manufacturing sectors.
  
 **Competition**
 
 The
North American steel industry is a cyclical business that is subject to intense
competition among producers with respect to price, service and
quality.
 
 The
steelmaking business is also capital intensive and significant capital
expenditures are required to achieve and maintain competitive levels of
capacity, cost, productivity and product quality.
 
 Offshore
producers can be a significant competitive factor for the Company. In recent
years, there has been a substantial increase in global steel capacity,
particularly in China which has become the largest steel producer and consumer
in the world. A significant slowdown in growth and/or increases in capacity,
which exceeded consumption rates in China or other countries, could result in
surplus steel which may be exported to world markets. In addition, many offshore
steel producers are controlled or subsidized by foreign governments whose
decisions concerning production and exports may be influenced by political and
economic policy considerations and not merely by the objective of profit
maximization. As a result, many offshore producers may continue to ship steel
products into the North American market even in times of relatively low steel
prices and narrow profit margins, thereby exacerbating adverse market
conditions.
 
 Competition
in the North American steel industry has intensified as a result of the
restructuring of certain integrated steel producers under applicable bankruptcy
laws. Following these reorganizations, these companies generally have lower
costs and have become more effective competitors.
 
 Integrated
steel producers have lost market share to mini-mills in recent years. Mini-mills
are efficient, low-cost producers that produce steel from scrap in electric arc
furnaces, have lower environmental compliance costs, target regional markets and
typically employ non-union workers. The relative competitive position of
mini-mills against integrated producers is influenced significantly by scrap
prices, which represent a significant production cost for mini-mills. During
industry downturns, scrap prices have historically declined which has improved
the competitive position of mini-mills.
 
 Increases
in the value of the Canadian dollar relative to the U.S. dollar make Canadian
steel products and Canadian customers less competitive in U.S. markets. A strong
Canadian dollar relative to the U.S. dollar also improves the competitive
position of U.S. producers exporting to Canada. The impact of changes in the
value of the Canadian dollar relative to other currencies may also have a
significant effect on the degree of competition from producers outside North
America. The negative effect of a stronger Canadian dollar on Algoma is
partially mitigated
  5
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 by the
purchase of the majority of raw materials in U.S. dollars, energy which has a
U.S. dollar basis, and payment of interest on the long-term debt that is
denominated in U.S. funds.
 
 The
Company’s competitive position is affected by transportation costs to customers
that are higher than those of other Canadian producers, which results in lower
net selling prices. However, closer proximity to the source of its iron ore
results in lower costs to transport iron ore to Sault Ste. Marie in comparison
to certain competitors.
 
 **Marketing
Initiatives**
 
 The
Company markets its sheet and plate products direct to end-users and also
through distributors in Canada and the United States. The Company is focused on
leveraging various competitive attributes of its process and product
technologies in strategic market segments in order to improve market and
customer segmentation. The Company pursues the development of applications and
markets for its high strength and light gauge products to respond to application
design factors.
 
 **Trade**
 
 Steel
imports into Canada in 2004 were approximately 46% of the apparent Canadian
consumption, a record high. Imports were 40% in 2003 and the previous record
high was in 2000 at 44%. In the United States, imports made up approximately 25%
of the 2004 apparent consumption, up from 19% of the apparent consumption in
2003.
 
 During
the course of the year, anti-dumping findings in place covering plate,
hot-rolled sheet and cold-rolled sheet from a number of countries were subject
to review. In all three cases, the Canadian International Trade Tribunal
(“CITT”) rescinded the findings, despite the determination by the Canada Border
Services Agency that dumping would resume from most of the countries covered by
the findings if the findings were removed. The CITT considered it unlikely that
producers in the subject countries would sell significant volumes of steel into
Canada or that any such volumes imported would be at such low prices that they
would cause injury to the domestic industry in the near to medium term.
 
 In
addition to the findings on product manufactured by the Company, findings were
also rescinded on Corrosion Resistant Sheet and on Re-bar (January 2005). The
Company, along with the rest of the industry, is disappointed with the
rescinding of the five findings. It is the Company’s view that, over the longer
term, imports from these countries will certainly cause injury to the domestic
industry. Since the removal of the findings, significant quantities of low
priced imports from several of the previously covered countries have arrived
and, along with imports from other countries, are putting pressure on domestic
pricing.
 
 The
expiry review concerning the dumping in Canada of carbon steel plate from
Brazil, Finland, India, Indonesia, Thailand and Ukraine, and the subsidizing of
plate from India, Indonesia and Thailand is underway. On February 10, 2005, the
president of the Canada Border Services Agency determined that dumping from
Finland and Thailand was not likely to resume. These two countries have now been
removed from the dumping review. The review continues at the CITT and a public
hearing is scheduled for May 2, 2005. Completion of the review is scheduled no
later than June 27, 2005.
 
 Customers
have been reporting significant import offerings for all product lines. This
increased availability of imports put pressure on domestic pricing in late 2004.
The Company is reviewing the import offers and will take the appropriate action
if the imports appear to be unfairly traded.
 
 
  6
    Algoma
      Steel Inc.
    Annual
      Information Form
 
  **Steelmaking
Facilities**
  The
Company is an integrated steelmaker in that it produces coke from coal, converts
iron ore to iron, iron to liquid steel and produces finished and semi-finished
steel products. The Company’s production facilities include three coke
batteries, two blast furnaces (one currently idle), one basic oxygen steelmaking
shop, continuous casting facilities and rolling and finishing mills. To
facilitate a further understanding of the Company’s strategic response to
technological changes in the steel industry, the following diagram illustrates
the Company’s existing steelmaking process.
  
 
 *(1)*
    *The
      #6 blast furnace is currently idle. This blast furnace is used for
      short-term backup during relines of #7 blast
  furnace.**(2)*
    *The
      existing hot strip and plate mill can be used to produce either sheet or
      plate subject to market conditions. The casting and rolling mill capacity
      exceeds ironmaking and steelmaking capacity by a substantial margin. The
      106” strip mill will be focused primarily on sheet sizes and grades not
      supported by the DSPC. In a 65% strip and 35% plate operation, the complex
      can produce 1.3 million tons of strip and 0.4 million tons of plate
      annually. In 2004, the complex operated at 53% capacity producing a total
      of 892.8 thousand tons of sheet and plate product.**(3)*
    *The
      Direct Strip Production Complex has a rated capacity of approximately 2.0
      million tons, but produced 1.6 million tons in
  2004.*
 
  7
    Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Raw
Materials and Energy**
 ******
 ***Iron
Ore***
  In
January 2002, Cannelton completed an agreement with Cliffs to transfer
Cannelton’s 45% interest in Tilden in exchange for the assumption by Cliffs of
Cannelton’s share of Tilden’s liabilities and no cash consideration. As part of
this arrangement, the Company entered into an exclusive 15-year supply agreement
with Cliffs for a minimum annual supply of 2.5 million tons of iron ore. The
arrangement permits Algoma to avoid certain risks associated with mine
ownership. Iron ore costs under this agreement are tied to global pricing for
iron ore, which is expected to increase significantly in 2005. If Algoma
defaults under the supply agreement prior to December 31, 2008, then 50% of the
liabilities assumed by Cliffs will revert back to Cannelton and
Algoma.
 
 ***Coal***
  Algoma
obtains its coal requirements through a supplier-owned consignment inventory.
The agreement with this supplier is in effect until March 31, 2006.
 
 ***Other
Raw Materials***
  The
Company purchases limestone, alloys and other raw materials for its
manufacturing operation. The Company generates most of its scrap requirements
internally and purchases any additional scrap as required.
 
 ***Energy***
  During
2004, fixed contracts were in place for 45% of Algoma’s monthly natural gas
requirements. The fixed contract pricing was below spot market pricing for the
majority of the contract period.
  During
2004, Algoma obtained electricity through third-party fixed-price contracts as
well as from the Independent Market Operator in Ontario at spot prices. During
2004, Algoma had fixed price contracts representing approximately 50% of its
average monthly electricity purchases. The fixed contract pricing was slightly
below spot market pricing for the majority of the contract period.
  Oxygen
is supplied by Praxair Canada Inc. through a 15-year agreement that commenced
July 1, 2000.
 
 ********Environment**
 
 The
Company’s environmental policy is to conduct its business reasonably and
responsibly with respect to the protection of the environment. Where
appropriate, the Company has introduced environmental accountability to all
employees. Activities that may have an impact on the external environment are
identified and managed through the implementation of the ISO14001 compliant
environmental management system. During the year, the Company successfully
completed the registration of all operating facilities and direct support areas
to the ISO14001 standard. The Company incurs substantial costs in implementing
its environmental programs and providing appropriate environmental
training.
 
 Algoma
has completed the fourth year of a five-year voluntary Environmental Management
Agreement with Environment Canada and the Ministry of the Environment. During
the year, the agreement focused on reducing benzene and polycyclic aromatic
hydrocarbon (PAH) emissions from its cokemaking operations. In 2005, Algoma will
undertake follow-up groundwater/sediment studies and PCB destruction. Currently,
the Company is meeting the PAH release targets established for
2015.
 
 Algoma
aggressively continued to reduce the generation of particulate emissions through
a Road Dust Reduction Program. Algoma completed the third of a four-year program
that is designed to reduce airborne particulates from roadways by implementing a
paving schedule, along with the use of dust suppressants. Through sophisticated
modeling techniques, Algoma has achieved a significant reduction in off-site
particulate emissions as a result of this initiative.
 
  8
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 The
Company is an active participant in national discussions to address climate
change and the reduction of carbon dioxide emissions within the steel sector.
Algoma was a supporting company to the Memorandum of Understanding that was
signed between the steel sector and the federal government. The memorandum
establishes a commitment to work towards developing reduction targets for the
industry. Algoma continues to reduce its energy and carbon dioxide intensities.
 
 Algoma
is committed to the following capital expenditures related to environmental
protection:
 
 #7
      Blast Furnace Cast House Emissions Control—
    Algoma
      is commited through a certificate of approval to install cast house
      emission controls by 2010.—
    Costs
      associated with this project are currently being
    determined.Noise
      Abatement Action Plan—
    Algoma
      is committed through a certificate of approval to implement a Noise
      Abatement Action plan.—
    The
      implementation timeline is currently under discussion with the Ontario
      Ministry of Environment.—
    Algoma
      has initiated Preliminary Engineering to identify costs and methods of
      control.
 
 **Employees**
 
 The
Company employed approximately 3,000 people as at December 31, 2004 of which
approximately 2,900 or 97% are unionized and represented by two Locals of the
United Steelworkers of America (“USWA”) under two collective bargaining
agreements. Both of these agreements expire July 31, 2007. The Company is
currently obligated to pay employees $10 million on June 30, 2005 with respect
to the collective agreements signed in January 2002.
 
 **Debt
Instruments**
 
 ***Banking
Facilities***
  On
September 3, 2003, the Company entered into a new Loan and Security Agreement
("Agreement"). The Agreement provides the Company with a revolving credit
facility (“Revolving Facility”) with financing equal to the lesser of $200
million and a borrowing base determined by the levels of the Company’s accounts
receivable and inventories less certain reserves. The Company is required to
maintain a minimum availability of $25 million. The Revolving Facility matures
on September 3, 2007 and is collateralized by a first charge on accounts
receivable and inventories. Borrowings can be made in either Canadian or United
States (U.S.) funds at rates fluctuating between 0.75% and 1.50% above either
the Canadian prime bank rate or the U.S. base rate or, at the Company's option,
at rates fluctuating 1.75% and 2.50% over bankers’ acceptance rate or London
interbank offering rate (“LIBOR”).
 
 ***Long-Term
Debt***
  The 11%
Notes, totaling $125 million U.S., are due in 2009 but are redeemable after 2005
at a declining premium ranging from 105.5% of principal in 2006 to 101.4% in
2008. A mandatory annual redemption of U.S. $12.5 million is required commencing
December 31, 2007 with the balance payable at maturity. Interest for the second
half of 2003 was paid on June 30, 2004. Interest is paid semi-annually on June
30 and December 31 of each year. The 11% Notes are collateralized by a first
charge on capital assets and a second charge on other assets.
  The
collateral, interest accrual and payment terms of the 1% convertible Notes were
identical to the 11% Notes. At September 30, 2004, all 1% convertible Notes that
had not previously been converted were redeemed at a cost of $1.8
million.
 
 **Legal
Proceedings**
 
 There
are no legal proceedings involving a material amount outstanding against the
Company.
 
  9
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Risk
Factors**
 
 **Highly
Competitive Nature of the Global Steel Industry**
 
 In
recent years, there has been a substantial increase in global steel capacity,
particularly in China which has become the largest steel producer and consumer
in the world. A significant slowdown in growth and/or increases in capacity,
which exceeded consumption rates in China, could result in surplus steel which
may be exported to world markets. In addition, an economic downturn which
affects demand for the Company’s products or an increase in the strength of the
U.S. dollar or Canadian dollar relative to other currencies could increase
imports. It is, therefore, possible that more unfairly priced imports could
enter the North American markets at a future date, resulting in further price
erosion, which would adversely affect the Company’s ability to compete, its
revenue and its profitability.
 
 Algoma
competes with numerous foreign and domestic steel producers. Some of its
competitors have greater financial and capital resources than Algoma does and
continue to invest heavily to achieve increased production efficiencies,
increased capacity and improved product quality. Algoma primarily competes with
other steel producers based on the delivered price of finished products to
Algoma’s customers. Algoma’s labour, raw material and energy costs are higher
than those of many foreign producers. Although freight costs for steel can often
make it uneconomic for distant steel producers to compete with the Company, to
the extent that they have lower cost of sales such as lower labour, raw material
or energy costs or are government subsidized, they may be able to successfully
compete. Although the Company is continually striving to improve its operating
costs, it may not be successful in achieving labour, raw material and energy
cost improvements or gaining operating efficiencies that may be necessary to
remain competitive.
 
 The
North American steel industry has historically faced significant competition
from foreign steel producers. Some non-market economy foreign steel producers
are owned, controlled or subsidized by their governments and their decisions
with respect to production, sales and exports may be influenced more by
political and economic policy considerations than by prevailing market
conditions. In addition, foreign steel producers may be subject to less
restrictive regulatory and environmental regimes that could provide a cost
advantage relative to North American producers.
 
 The
domestic steel industry has experienced lengthy periods of difficult markets due
to increased foreign imports. Due to unfavourable foreign economic conditions,
excess foreign capacity and a strong Canadian and U.S. dollar, imports of steel
products to the U.S. and Canadian markets have reached high levels and, in some
cases, have been sold at prices below their combined production and export
costs. From 1995 to 2004, U.S. steel industry production capacity utilization
levels ranged from a high of 93.3% in 1995 to a low of 79.2% in 2001 and were
approximately 91% in 2004.
 
 On
January 29, 2004, Stelco Inc., Canada’s largest steel company, applied for
protection under the *Companies’
Creditors Arrangement Act* . In
addition, since the beginning of 1997, over 35 U.S. steel companies have sought
protection under Chapter 11 of the *United
States Bankruptcy Code* . Many
of these companies have continued to operate, while reducing prices to maintain
volumes and cash flow and obtaining concessions from their labour unions and
suppliers. Some companies have even expanded and modernized during these
reorganizations. Upon emerging from reorganization, these companies, or new
entities that purchased their facilities through this process, have been
relieved of many obligations including environmental, employee and retiree
benefits and other obligations commonly referred to as legacy costs. As a
result, they may be able to operate with lower costs than Algoma. Stelco Inc.
may emerge from a court-supervised restructuring with some or all of these
advantages.
 
  10
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Low Priced
Imports and Trade Regulation**
 
 The
Company’s business has historically been affected by both Canadian and United
States trade legislation intended to limit “dumping”, a practice employed by
certain foreign competitors that have sold steel into the U.S. or Canadian
markets at prices below their costs or below prices prevailing in their own
domestic markets. Such practices may result in injury to companies producing
goods in Canada or the U.S. in the form of suppressed prices, lost sales, lower
profits and reductions in production, employment levels and the ability to raise
capital. Although in a number of cases Canadian trade laws have been
successfully employed in the past, they may be inadequate to prevent future
unfair import pricing practices which individually or collectively could
materially adversely affect the Company. If current and future trade cases do
not provide relief from such trade practices, relevant Canadian trade laws are
weakened, world demand for steel decreases, or the U.S. or Canadian dollars
strengthen against foreign currencies, an increase in the market share of
imports into Canada may occur, which could have a material adverse effect on the
Company. Moreover, trade regulations in other countries, particularly the United
States, could materially adversely affect Algoma to the extent that they reduce
or eliminate Algoma’s access to certain steel markets. There can be no
assurances that the Company will be able to compete effectively in the
future.
 
 A
change in the situation in China could have a significant impact on steel
markets in the rest of the world. China is presently increasing steel producing
capacity by millions of tons every year. It is also importing large volumes of
finished steel and raw materials. China’s imports of raw materials are driving
up prices in the rest of the world, particularly for iron ore and scrap. Chinese
demand for vessels to import raw materials and export finished products has also
caused increasing ocean freight rates. Although this situation may be favourable
to the Company at the present time as it is driving up the price of steel
products in North America, it may change in the future. As the Chinese supply of
steel is brought into balance with the demand, countries presently exporting to
China will be searching for alternative markets. Since Canada and the U.S. are
the largest “open market” in the world, imports from these other countries could
impact the North American market resulting in a loss of sales volume, price and
profitability for the Company.
 
 **Cyclicality
of the North American Steel Industry**
 
 The
North American steel industry is cyclical in nature and sensitive to general
economic conditions. The financial condition and results of operation of
companies in the steel industry are generally affected by macroeconomic
fluctuations in the Canadian, U.S. and global economies. Due mainly to its
product mix, Algoma has a higher exposure to spot markets than most of its North
American competitors and is, therefore, subject to more volatility in its
selling prices. In addition, steel prices are sensitive to trends in cyclical
industries such as the North American automotive, construction, appliance,
machinery and equipment, and transportation industries, which are significant
markets for the Company’s products. In addition, many of its customers are
affected by North American and worldwide economic downturns, which have
resulted, and may in the future result, in defaults in the payment of accounts
receivable owing to the Company and reduced sales levels.
 
 **Supply
and Cost of Raw Materials and Energy**
 
 Algoma’s
operations require substantial amounts of raw materials and energy including
coal, iron ore, alloys, scrap, oxygen, natural gas, electricity and other
inputs. The price and availability of such raw materials and inputs are subject
to market forces and, in some cases, government regulations and accordingly, are
subject to change. The cost of several key inputs, including iron ore, is
expected to increase substantially in 2005 and coal costs are projected to
increase significantly in 2006 as an existing three-year agreement with
favourable prices expires. The Company could be particularly adversely affected
during a period of declining selling prices for steel without a corresponding
decline in raw material costs. Algoma’s results of operations could be adversely
affected by supply interruptions or further increases in the cost of materials.
Algoma’s iron ore, coal, alloy and scrap costs would be adversely affected by a
decrease in the relative value of the Canadian dollar. There can be no assurance
that adequate supplies of oxygen, electricity, natural gas, coal, iron ore or
alloys will be available in the future or that future increases in the cost of
such materials will not adversely affect Algoma’s operations.
  11
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Currency
Fluctuations**
 
 The
prices for steel products sold in Canada are derived mainly from price levels in
the U.S. market in U.S. dollars converted into Canadian dollars at the
prevailing exchange rates. As a result, a stronger Canadian dollar relative to
the U.S. dollar reduces the Company’s Canadian dollar selling prices for sales
into both Canada and the U.S.
 
 Increases
in the value of the Canadian dollar relative to the U.S. dollar make Canadian
steel products and Canadian customers less competitive in U.S. markets and also
encourage imports from the U.S. Therefore, a significant increase in the value
of the Canadian dollar could materially adversely affect Algoma’s results of
operations and financial condition. Algoma considers its currency hedging
strategy from time to time and currently has no hedging contracts in
place.
 
 Increases
in the value of the Canadian dollar relative to the home currencies of global
steel producers would also increase the probability of increased
imports.
 
 **Underfunding
of Pension Plans**
 
 The
Company had an unfunded pension liability of $254 million as at December 31,
2004, based on an actuarial estimate for financial reporting. On a statutory
funding basis, the unfunded liability is estimated at $212 million as at
December 31, 2004. Employer contributions in 2004 were $72 million which
included a one-time contribution of $40 million. Based on current interest
rates, benefits and projected investment returns, the Company expects that
annual funding will increase to approximately $50 million in 2005, subject to
annual adjustments thereafter. A significant portion of the estimated increased
funding is expected to be a payment towards the reduction of the unfunded
liabilities. The unfunded liability could increase due to changes to the
Company’s collective bargaining agreements, a decline in interest rates,
investment returns at less than the actuarial assumptions, or changes to the
governmental regulations governing funding and other factors. The Company could
be adversely affected by the resulting increases in annual funding
obligations.
 
 **Post
Employment Benefits**
 
 The
Company provides certain post employment benefits to its retirees. These
benefits include drug, life insurance and hospitalization coverage. The Company
does not prefund these obligations. At December 31, 2004, the liability for
these obligations was $243 million. The cash paid in 2004 to fund these benefits
was $13 million. The Company’s obligation for these benefits could increase in
the future due to a number of factors including changes in interest rates,
changes to its collective bargaining agreements, increasing costs for these
benefits, particularly drugs, and any transfer of costs currently borne by
government to the Company.
 
 **Substantial
Capital Investment, Capital Commitments and Maintenance Expenditures
Required**
 
 The
Company’s operations are capital intensive. Algoma expects to be required to
make ongoing significant capital expenditures in an effort to achieve and
maintain competitive levels of capacity, cost, productivity and product quality.
Total capital expenditures were $25.9 million, $36.8 million and $42.4 million
for the years ended December 31, 2002, 2003 and 2004, respectively. Capital
expenditures at these low levels cannot be sustained indefinitely. Capital
expenditures in 2005 are expected to be approximately $75 million.
 
 The
most significant capital project facing the Company is the #7 Blast Furnace
reline currently scheduled for 2010 at an estimated cost of $120 million. In
addition to the capital expenditure for the reline, there is a substantial
operating cost penalty during the reline related to lower production volume and
the need for purchased slabs. The timing and cost of the #7 Blast Furnace reline
is critical to the Company and there is a risk that a complete reline could be
required prior to 2010. The Company has estimated that an additional expenditure
of approximately $52 million will be required between 2005 and 2010 to support
the blast furnace operation until the planned reline in 2010.
 
  12
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 Algoma’s
business may not generate sufficient operating cash flow and external financing
sources may not be available in an amount sufficient to enable it to make
anticipated capital expenditures, service or refinance its indebtedness, or fund
other liquidity needs.
 
 **Variability
of Financial Results**
 
 Algoma’s
financial results may fluctuate substantially, not only due to the cyclicality
of the steel industry and fluctuations in foreign exchange rates, but also due
to other factors such as Algoma’s higher exposure to spot markets than most of
its North American competitors, specific product competition, operating
performance, uncontrollable increases in prices of raw materials and energy, and
difficulties or delays in capital projects. Although selling prices increased
significantly in 2004, no assurance can be given that these improvements will be
sustained in the future.
 
 **Adverse
Impact of the Company’s Level of Indebtedness**
 
 The
Company’s debt obligations are manageable under current circumstances, but a
change in steel market conditions or other variables may necessitate
consideration of refinancing or the adoption of alternative strategies to reduce
or delay expenditures, selling assets or seeking additional equity
capital.
 
 **Financial
Restrictions**
 
 The
trust indenture in respect of Algoma’s 11% Notes, its loan agreement and other
agreements governing Algoma’s indebtedness contain provisions that limit its
ability to pay dividends or make other restricted payments or investments, incur
additional indebtedness, create liens on assets, merge, consolidate or sell all
or substantially all of its assets, and create restrictions on dividends or
other payments by restricted subsidiaries. In addition, Algoma’s revolving
credit facility contains restrictive covenants that require Algoma to maintain a
minimum unused availability of $25 million and to maintain financial ratios when
unused availability is below $50 million, including minimum levels of cash flow
to total debt service and maximum annual capital expenditure levels. Algoma’s
ability to comply with these restrictions may be affected by events beyond its
control. Algoma may not achieve operating results that will permit it to meet
these restrictive covenants or may need to take business actions prohibited by
these covenants. These covenants may also limit Algoma’s ability to obtain
additional or more favourable financing. In addition, substantially all of
Algoma’s assets have been pledged to secure its revolving credit facility and
the 11% Notes.
 
 **Labour
Matters**
 
 Algoma
has approximately 3,000 employees, of which approximately 2,900, representing
97% of the Company’s employees, are represented by two locals of the United
Steelworkers of America under two collective bargaining agreements. The
collective agreements expire on July 31, 2007. Algoma may be unable to
successfully negotiate new collective bargaining agreements without any labour
disruption.
 
 Algoma’s
customers, or companies upon which Algoma are dependent for raw materials,
transportation or other services, could also be affected by labour difficulties.
Any such activities, disruptions or difficulties could result in a significant
loss of production and sales and have a material adverse effect on Algoma’s
financial condition or results of operations.
 
 **Environmental
Matters**
 
 Algoma’s
operations are required to comply with an evolving body of environmental laws
concerned with, among other things, emissions into the air, discharges to
surface and ground water, the investigation and remediation of contaminated
property, noise control, waste management and disposal, mine closure and
rehabilitation, and the generation, handling, storage, transportation, presence
and disposal of toxic and hazardous substances. These laws and regulations vary
depending on the location of the facility and can fall within federal,
provincial or municipal jurisdictions.
  13
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 In the
United States and Canada, certain environmental laws and regulations impose
joint and several liability on certain classes of persons for the costs of
investigation and remediation of contaminated properties. Liability may attach
regardless of fault or the legality of the original management or disposal of
the substance or waste. Some of the Company’s present and former facilities have
been in operation for many years and, over such time, have used substances and
disposed of wastes that may require investigation and remediation. Algoma could
be liable for the costs of such investigations and remediation. Costs for any
remediation of contamination, on or off site, whether known or not yet
discovered, or to address other issues relating to waste disposal, mine closure,
emissions into the air or water, or the storage of materials, could be
substantial and could have a material adverse effect on Algoma’s results of
operations.
 
 The
Company is required to file a mine closure plan respecting its
former  iron
ore mine in  Wawa  by
December 31, 2006. At that time, the Company expects to be required to provide
financial assurance to the Province of Ontario in respect of ongoing maintenance
and further capital required at the mine site . The
annual  ongoing
maintenance expenses  are
estimated  at
$200,000. Total capital expenditures, currently estimated at $7 million, are
expected to commence in 2010. No assurance can be given that current estimates
for ongoing maintenance and capital expenditures are accurate. The form or
amount of financial assurance required by the Province will not be determined
until the filing of the mine closure plan in December 2006.
 
 Pursuant
to a Certificate of Approval dated May 24,
2003 , the
Company is required to install, by 2010, certain equipment in the No. 7 Blast
Furnace to reduce casthouse emissions. The cost of this equipment and its
installation is currently estimated at $25 million. No assurance can be given
that the actual cost of the equipment and its installation will not exceed the
Company's current estimate.
 
 Algoma’s
Environment, Health and Safety Department regularly reviews and audits the
Company’s operating practices to monitor compliance with Algoma’s environmental
policies and legal requirements.
 
 No
assurance can be given that unforeseen changes, such as new laws or stricter
enforcement policies, or a crisis at one of Algoma’s properties or operations,
will not have a material adverse effect on the business, financial condition or
results of operations of Algoma. Algoma’s operations are required to have
governmental permits and approvals. Any of these permits or approvals may be
subject to denial, revocation or modification under various circumstances.
Failure to obtain or comply with the conditions of permits or approvals may
adversely affect the operations of Algoma and may subject Algoma to penalties.
In addition, if environmental laws are amended or are interpreted or enforced
differently, or if new environmental legislation is enacted, Algoma may be
required to obtain additional operating permits or approvals and incur
additional costs. There can be no assurance that Algoma will be able to meet all
applicable regulatory requirements. In addition, Algoma may be subject to fines,
penalties or other liabilities arising from its actions imposed under
environmental laws, including as a result of actions or other proceedings
commenced by third parties, such as neighbours or government
regulators.
 
 **Technology
and Competition**
 
 There
is ongoing research and technological developments with respect to the various
processes associated with steel production which have the potential to reduce
costs and improve quality. It is possible that certain developments could
substantially impair the Company’s competitive position if other companies
implement new technology and the Company does not or cannot do so.
 
 **Recent
Insolvencies**
 
 In
February 1991, the predecessor company to Algoma became insolvent and sought
protection under the CCAA. In April 2001, the Company filed for protection under
the CCAA. On January 29, 2002, Algoma emerged from court protection
pursuant to a plan of arrangement and reorganization.
 
  14
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Competition
of Products with Other Materials**
 
 In the
case of certain product applications, steel competes with a number of other
materials such as plastic, aluminum, and composite materials. Improvements in
the technology, production, pricing or acceptance of these competitive materials
relative to steel or other changes in the industries for these competitive
materials could cause net sales to decline.
 
 **Unexpected
Equipment Failures**
 
 Algoma’s
manufacturing processes are dependent upon critical steelmaking equipment such
as furnaces, continuous casters, rolling mills, and electrical equipment (such
as transformers), and this equipment may incur downtime as a result of
unanticipated failures. The Company has experienced, and may in the future
experience, plant shutdowns or periods of reduced production as a result of such
equipment failures. Unexpected interruptions in production capabilities would
adversely affect productivity and results of operations for the affected period.
No assurance can be given that a significant shutdown will not occur in the
future or that such a shutdown will not have a material adverse effect on the
business, financial condition or results of operations of the Company. In
addition, an unexpected failure in the Company’s computer system may have the
same result.
 
 **Dependence
on Senior Management**
 
 Algoma’s
operations and prospects depend, in large part, on the performance of Algoma’s
senior management team. The Company cannot assure that such individuals will
remain as employees. In addition, Algoma can make no assurance that it would be
able to find qualified replacements for any of these individuals if their
services were no longer available. The loss of the services of one or more
members of senior management or difficulty in attracting, retaining and
maintaining additional senior management personnel could have a material adverse
effect on Algoma’s business, financial condition and results of
operations.
 
 **Insurance**
 
 To
date, Algoma has been able to obtain liability insurance for the operation of
its business. However, there can be no assurance that Algoma’s existing
liability insurance will be adequate, or that it will be able to be maintained,
or that all possible claims that may be asserted against Algoma will be covered
by insurance.
 
 **Future
Capital Requirements**
 
 The
Company may need to raise additional funds in the future in order to take
advantage of growth opportunities or to respond to competitive pressures. There
can be no assurance that additional financing will be available on terms
acceptable to the Company. If adequate funds are not available or are not
available on acceptable terms, the Company may be adversely
affected.
 
 **Tax
Loss Carryforwards**
 
 The
Company’s income tax loss carryforwards were reduced by approximately $180
million under the financial reorganization as a result of debts being discharged
for less than their principal amount. Federal and Ontario non-capital loss
carryforwards at December 31, 2004 are estimated to be $111 million and $282
million respectively based on requested amendments. Algoma’s estimate of
non-capital loss carryforwards has not been reviewed by the Canada Revenue
Agency (or any successor agency) and could be reduced.
 
 **Effect
of Potential Future Acquisitions**
 
 Algoma
believes that there continues to be significant opportunity for future growth
through selective acquisitions given the pace of consolidation in the steel
industry and the increasing trend of its customers to
  15
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 focus
on fewer key suppliers. As a result, Algoma intends to continue to apply a
selective and disciplined acquisition strategy. Possible future acquisitions
will likely involve a number of risks.
 
 Future
acquisitions may be required for the Company to remain competitive, but there
can be no assurance it can complete any such transactions on favourable terms or
that it can obtain financing, if necessary, for such transactions on favourable
terms. In addition, there can be no assurance that future transactions will
improve the Company’s competitive position and business prospects as
anticipated; if they do not, its results of operations may be adversely
affected.
 
 **Dividend
Policy**
 
 The
Company has not paid any dividends on its common shares. The terms of the 11%
Note Indenture limit the amount of dividends that can be paid, but allow
payments for certain items such as dividends based on a formula linked to
cumulative net income and proceeds from equity issues since January 2002. At
December 31, 2004, the Company could disburse approximately $250
million.
 
 **Capital
Structure**
 
 The
Company is authorized to issue an unlimited number of common shares. At December
31, 2004, there were 40,117,587 common shares issued and outstanding. Each
holder of common shares is entitled to one vote per share held at all meetings
of shareholders.
  ****
 **Directors
and Executive Officers**
 
 The
following are the names and municipalities of residence of the Company’s current
directors and executive officers and their respective offices and principal
occupations during the five preceding years. Directors are elected to serve
until the next Annual Meeting of Shareholders.
  **Director’s
      Name**
    **Director
      Since****Steven
      Bowsher****(3)
      (5)**
      Prospect
      Heights, Illinois
    May
      22, 2003President,
      ClearCut Advisors, a business consulting firm, 2002-present; President and
      CEO, Indesco International, 2001-2002; Executive Vice President
      Commercial, Ispat Inland Steel Company, 1998-2000.**Benjamin
      Duster****(5)**
      Atlanta,
      Georgia
    January
      29, 2002Chairman
      of the Board of the Company; Head of Financial Restructuring, Masson &
      Company, LLC, a financial restructuring consulting firm, 2001-present;
      Managing Director, Mergers and Acquisitions, Wachovia Securities,
      1997-2001.**John
      Kallio****(2)
      (5)**
      Sault
      Ste. Marie, Ontario
    October
      29, 1996Union
      Department Steering Committee Co-Chair - Plate & Strip, 2002-present;
      Loader - Plate & Strip Finishing, 1999-2002 - both positions at the
      Company.
 
  16
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Director’s
      Name**
    **Director
      Since****Marie
      Kelly**
      Toronto,
      Ontario
    October
      27, 2004Assistant
      Director, United Steelworkers of America, District 6, a trade union,
      2001-present; Counsel to United Steelworkers of America,
      1991-2001.**Patrick
      Lavelle****(1)
      (2) (4)**
      Toronto,
      Ontario
    January
      29, 2002Chairman
      and CEO, Patrick J. Lavelle and Associates, a strategic management
      consulting firm.**James
      Lawson****(3)
      (4)**
      Oakville,
      Ontario
    January
      29, 2002President
      and CEO, Westerkirk Capital Inc., a private investment firm, 2004-present;
      Partner, Torys LLP, 2001-2004; Senior Vice President - Corporate
      Development and General Counsel, XO Communications Canada Inc., 2000-2001;
      Partner, Davies Ward & Beck, 1989-2000.**Charles
      Masson****(1)
      (4**)**(5)**
      New
      York, New York
    February
      28, 2002Partner,
      Masson & Company, LLC, a financial restructuring consulting firm,
      1998-present.**Murray
      Nott****(1)
      (4)**
      Sault
      Ste. Marie, Ontario
    June
      1, 1992Metallurgical
      Specialist - Quality Engineering, Algoma Steel Inc.,
      1997-present.**Francis
      Petro****(1)
      (2) (3)**
      Kokomo,
      Indiana
    May
      22, 2003President
      and CEO of Haynes International Inc., a technology-oriented company
      devoted primarily to the development and manufacture of high-performance
      nickel- and cobalt-based alloys, 1999-present.**Denis
      Turcotte**
      Sault
      Ste. Marie, Ontario
    October
      4, 2002President
      and CEO of the Company, September, 2002 - present;
      President
      - Paper Group/Executive Vice President Corporate Development and Strategy,
      Tembec Inc., 1999-2002.
 (1)
    Member
      of the Audit Committee.(2)
    Member
      of the Health, Safety and Environment Committee.(3)
    Member
      of the Human Resources and Compensation Committee.(4)
    Member
      of the Corporate Governance Committee.(5)
    Member
      of the Strategic Planning Committee.Algoma does
      not have an Executive
Committee**.**
  17
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Officer’s
      Name**
    
    **Office
      and Principal Occupation****Benjamin
      Duster**
      Atlanta,
      Georgia
    
    **Chairman
      of the Board, February 2002-present;**
      Head
      of Financial Restructuring, Masson & Company, LLC, a financial
      restructuring consulting firm, 2001-present; Managing Director, Mergers
      & Acquisitions, Wachovia Securities, 1997-2001.**Denis
      Turcotte**
      Sault
      Ste. Marie, Ontario
    
    **President
      and Chief Executive Officer, September 2002-present;**
      President,
      Paper Group/Executive Vice President Corporate Development and Strategy,
      Tembec Inc., 1999-2002.**Stephen
      Boniferro**
      Sault
      Ste. Marie, Ontario
    
    **Vice
      President, Human Resources, July 1998-present.****Paul
      C. Finley**
      Sault
      Ste. Marie, Ontario
    
    **Vice
      President, Business Development and Corporate Secretary, November
      2002-present;**
      General
      Counsel and Corporate Secretary of the Company, 1992-2002.******Glen
      P. Manchester**
      Sault
      Ste. Marie, Ontario
    
    **Vice
      President, Finance and Chief Financial Officer, May 2003-present;**
      Vice
      President, Commercial of the Company, June 2002-April 2003;
      Vice
      President, Finance and Administration of the Company,
      2001-2002;
      Vice
      President and General Manager, Flat Rolled Business of the Company,
      1999-2001.**Armando
      Plastino**
      Sault
      Ste. Marie, Ontario
    
    **Vice
      President, Operations, March 2002-present;**
      General
      Manager, Flat Roll Operations of the Company, November
      1999-2002.**Paul
      Royal**
      Oakville,
      Ontario
    
    **Vice
      President, Commercial, April 2004-present;**
      Executive
      Vice President, Orion Bus Industries,
1999-2004.
 As at
the date hereof, the directors and executive officers of Algoma, as a group,
beneficially owned, directly and indirectly, or exercised control or direction
over less than 1% of the common shares of Algoma.
 
  18
  
 Algoma
      Steel Inc.
    Annual
      Information Form
 
 **Market
for Securities**
 
 The
common shares of Algoma are listed for trading on the Toronto Stock Exchange
under the trading symbol AGA. The
following table sets forth the market price range and trading volumes of the
Company’s common shares on the Toronto Stock Exchange for each month of
2004.
  **Year
      ended December 31, 2004**
    
    **High**
    
    **Low**
    
    **Close**
    
    **Trading
      Volume**January
    
    
    8.40
    
    
    6.60
    
    
    7.82
    
    
    5,973,982February
    
    
    9.44
    
    
    7.75
    
    
    9.20
    
    
    7,920,799March
    
    
    9.95
    
    
    8.15
    
    
    9.25
    
    
    6,541,989April
    
    
    11.09
    
    
    8.90
    
    
    9.80
    
    
    7,560,054May
    
    
    10.00
    
    
    8.25
    
    
    8.99
    
    
    5,150,791June
    
    
    11.75
    
    
    8.28
    
    
    11.00
    
    
    5,211,793July
    
    
    12.70
    
    
    10.33
    
    
    12.50
    
    
    5,203,452August
    
    
    13.86
    
    
    12.53
    
    
    13.79
    
    
    9,446,876September
    
    
    22.10
    
    
    13.69
    
    
    21.90
    
    
    24,297,246October
    
    
    23.15
    
    
    18.21
    
    
    20.50
    
    
    17,292,608November
    
    
    30.20
    
    
    19.80
    
    
    29.70
    
    
    13,877,290December
    
    
    30.85
    
    
    27.40
    
    
    29.30
    
    
    10,116,402
 ****
 **Transfer
Agent and Registrar**
 
 Algoma’s
transfer agent and registrar for its common shares is Computershare Trust
Company of Canada, located at 100 University Avenue, 9 th Floor,
Toronto, Ontario M5J 2Y1.
 
 **Interests
of Experts**
 
 The
Company’s auditor in 2004 was Ernst & Young LLP, Ernst & Young Tower,
Toronto-Dominion Centre, P.O. Box 251, Toronto, Ontario M5K 1J7. The Company’s
consolidated financial statements as at the year ended December 31, 2004 have
been filed under National Instrument 51-102 in reliance on the report of Ernst
& Young LLP, independent chartered accountants, given on their authority as
experts in auditing and accounting. As of January 28, 2005, the partners and
employees of Ernst & Young LLP collectively owned beneficially, directly or
indirectly, less than 1% of the Company’s outstanding common
shares.
 
 The
Company accepted the resignation of Ernst & Young LLP as the auditor of the
Company effective February 25, 2005. Ernst & Young LLP, or its predecessors,
had been the Company’s auditor since June 30, 1992. On March 2, 2005, KPMG LLP
was appointed by the Board as the auditor of the Company to hold office until
the next Annual Meeting of Shareholders.
 
 **Additional
Information**
 
 Additional
information relating to Algoma may be found on SEDAR at
www.sedar.com.
 
 Additional
information, including directors’ and officers’ remuneration and indebtedness,
principal holders of securities and securities authorized for issuance under
equity compensation plans is contained in the Management Information Circular
dated March 15, 2005. Additional financial information is provided in the 2004
Consolidated Financial Statements and Management’s Discussion and Analysis of
Financial Condition and Results of Operations set forth in the 2004 Annual
Report of Algoma.
 
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