SANDFIRE RESOURCES LIMITED — Capital/Financing Update 2009

Jul 7, 2009

7 July 2009

ASX RELEASE

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MORE EVIDENCE OF A SUBSTANTIAL DISCOVERY AT DOOLGUNNA

Sandfire Resources NL (ASX: SFR ) is pleased to report that the first hole in its new diamond drilling program at the Doolgunna project in WA has so far intersected two significant intervals of massive sulphides containing abundant chalcopyrite.

The hole (DGDD001) intersected massive sulphides from 146m to 157m (11 metres) down hole and hit a second interval of massive sulphides from 176m to 207m (31 metres). These intersections are considered to be approximately 70 percent of the true widths of the lodes with both intersections being part of the DeGrussa zone of mineralisation.

Sandfire announced on Monday, 6 July 2009, that the initial three RC drill holes at Conductor 1 had returned outstanding assay results, which confirmed the existence of a significant body of sulphide mineralisation.

The latest hole is collared approximately 240m due south of DGRC115.

This hole, DGDD001, is inclined at 60 degrees to the north, designed to intersect the Conductor 1 mineralisation at a vertical depth of approximately 300 metres and down dip from DGRC115. Collar co-ordinates for the hole DGDD001 are 7173000mN and 733840mE (GDA94).

Sandfire Chief Executive, Karl Simich, said the extension of the DeGrussa mineralisation seemed to be running above and parallel to the Conductor 1 mineralisation, creating two separate “sheets” of mineralisation.

Doolgunna Project – Background

The Doolgunna Project is located approximately 130km north of Meekatharra (900km north of Perth) in Western Australia close to a number of existing and historical gold mines and infrastructure including the Goldfields Gas Pipeline and Great Northern Highway.

Sandfire has so far discovered two zones of high-grade sulphide mineralisation at DeGrussa and Conductor 1 in the north-eastern portion of the Doolgunna tenements. These discoveries appear to comprise volcanogenic massive sulphide (VMS) style mineralisation located beneath an oxide copper-gold zone.

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MORE EVIDENCE OF A SUBSTANTIAL DISCOVERY AT DOOLGUNNA

7 July 2009 Page 2

Conductor 1 lies approximately 160 metres to the north-west of DeGrussa and comprises a large body of sulphide mineralisation dipping in a southerly direction. The second round of drilling, which commenced on Saturday, 4 July 2009, is aimed at testing the extent of the mineralisation to the south. The results of this diamond drilling program will determine the next steps in the exploration of Conductor 1 and DeGrussa.

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W JOHN EVANS TECHNICAL DIRECTOR AUSIMM Competent Person

Competent Person’s Statement

The information in this report that relates to Exploration Results is based on information compiled by John Evans who is a Fellow of the Australasian Institute of Mining and Metallurgy. John Evans has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves. John Evans consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

For further information, please contact:

Karl Simich – Managing Director: Mobile: +61 418 916 945 John Evans – Technical Director: Office: +61 8 9226 5833

Nicholas Read / Paul Armstrong – Read Corporate: Mobile: +61 419 929 046 (Nicholas Read) Mobile: +61 421 619 084 (Paul Armstrong)

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