Sandfire Resources NL ABN 55 105 154 185 Level 2, 31 Ventnor Ave, West Perth Western Australia 6005 Phone: +61 8 6430 3800 Fax: +61 8 6430 3849 Email: [email protected] Web: www.sandfire.com.au

==> picture [276 x 55] intentionally omitted <==

ASX/Media Release 6 September 2011

FIRST DEGRUSSA PROJECT DEBT FACILITY DRAW-DOWN AND DEVELOPMENT UPDATE

EVANS DECLINE DEVELOPED TO 350m: CONSTRUCTION UNDERWAY

Sandfire Resources NL (ASX : SFR ; “Sandfire”) is pleased to advise that it has completed the first drawdown of funding under the previously announced $75 million mine development facility for its 100%owned DeGrussa Copper-Gold Project in Western Australia, following satisfaction of all conditions precedent to the facility.

Sandfire has drawn down the first $30 million under this initial facility (Facility A), which together with the Company’s existing cash assets (currently approximately $27 million), will continue to fund ongoing mine development and construction activities at DeGrussa.

The first draw-down under the senior debt facility marks another key milestone in the execution of the DeGrussa Project development, which is on track to produce its first high-grade copper ore in Q1 of CY 2012 (shipping from Q2 of 2012) and first high-grade copper concentrate in Q3 of CY 2012 (shipping from Q4 of 2012).

Due diligence processes on the overall $360 million underwritten secured (fixed and floating) construction, development and environmental bonding facility (Facility B) are proceeding well, with execution of this facility expected around the end of Q3 of CY 2011.

The syndication process for Facility B is being led by Australian and New Zealand Banking Group Limited (“ANZ”), which will retain a cornerstone position in the syndication.

The Definitive Feasibility Study (DFS) estimated total pre-production capital for the DeGrussa Project at $384 million, comprising $267 million for plant, equipment and infrastructure, $44 million for open pit mining, $56 million for underground mine development and $17 million of other pre-production capital.

There is no compulsory hedging required as part of the debt facilities, however the Company will continue to consider and if warranted develop its hedging policies in line with the outcomes of the DFS.

Development Update

Development expenditure on the DeGrussa Project totals $96 million to date, with mine development activities well advanced and infrastructure construction now underway.

A total of more than 1.6 million bcm (bank cubic metres) of waste and 80,000 bcm of oxide copper and gold material has been mined as part of the Stage 1 open pit (in line with DFS forecasts). In excess of 120,000t of oxide gold material grading 1.6g/t Au and 55,000t of oxide copper material grading 0.5% Cu has been mined to date.

==> picture [526 x 89] intentionally omitted <==

ASX / Media Release

6 September 2011

The Evans Decline is currently de v eloped to 350m from the portal, a depth of 70m below surface, with development rates exceeding DFS forecasts as ground conditions improve with depth. A total of more than 300 people are currently on site, with construction of the 1.5Mtpa DeGrussa Concentrator scheduled to start mid-September 2 011.

Sandfire’s Managing Director, Mr K arl Simich, said he was pleased with the ra p id and efficient progress on site, with the entire project development team remaining focused on achievi n g key milestones on time and on budget.

“We are looking forward to concl u ding the second facility and pressing ahe a d with construction and development activities as rapidly as possible to position Sandfire to generate first cash flow early next year,” he added.

ENDS

For further information contact: Sandfire Resources NL Read Corporate Karl Simich – Managing Director/CEO Mobile: +61 419 929 046 (Nichol a s Read) Office: +61 8 6430 3800 Mobile: +61 421 619 084 (Paul Armstrong)