SANDFIRE RESOURCES LIMITED — Share Issue/Capital Change 2006

Jul 10, 2006

EVENTINOR AVE WEST PERTH 6005 WESTERN AUSTRALIA

T 461 8 9226 5833 F +61 8 9226 5844 Cadmini Sandiirs.com.au

No. of pages lodged: 1

Company Announcements Office Australian Stock Exchange Limited 4^th Floor 20 Bridge Street SYDNEY NSW 2000

Dear Sir/Madam

EMPLOYEE AND CONSULTANT INCENTIVE

Certain of the Company's employees and consultants have been advised that provided they continue to serve and are serving the Company to the Company's satisfaction as at 1 July 2007 they will thereupon become entitled to apply for contributing shares (ASX code SFRCA) at a nominal price. The maximum number of SFRCAs to be issued under that advice is 750,000.

The Company is at a crucial stage in exploration and development with its key projects and this type of incentive will assist in continuous sound management.

Mal Smartt Company Secretary 11 July 2006