ST BARBARA LIMITED — Capital/Financing Update 2004

Sep 30, 2004

ST BARBARA MINES LIMITED

ACN 009 165 066

ASX SHAREHOLDERS REPORT

Enquiries regarding this report may be directed to:

Eduard Eshuys

Managing Director Telephone $(08)$ 9476 5555 Overseas +61 8 9476 5555

St Barbara Mines Limited ACN 009 165 066 Level 2, 16 Ord Street West Perth Western Australia 6005 Telephone $(08)$ 9476 5555 Overseas +61 8 9476 5555

Confirmation of Sale of NuStar Shares and Paulsens Royalty

Further to our announcement of 20 September 2004 we are pleased to advise that the Company has sold 100 million NuStar Mining Corporation Limited ("NuStar") shares at 4 cents each on 30 September 2004.

Proceeds will substantially be applied to fully repaying the Company's secured debt.

In addition, the Company has executed agreements and received a cash deposit of $1.165 million for the surrender of its Paulsens Royalty and sale of its interest in the Pelican Joint Venture. The surrender of the royalty transaction with NuStar is subject to shareholders approval.

The Company has also agreed to extend the transferable option granted to Claymore Capital Pty Ltd to acquire a further 100 million NuStar shares at 5 cents each, from 3 months to 7½ months.

These transactions represent an important step towards the Company securing its financial future and generating working capital for exploration.

Eduard Eshuys Managing Director & CEO

1 October 2004