ST BARBARA LIMITED — Capital/Financing Update 2010

Sep 2, 2010

St Barbara Limited ACN 009 165 066

Level 14, 90 Collins Street, Melbourne VIC 3000 Locked Bag 9, Collins Street East, Melbourne VIC 8003 Tel +61 3 8660 1900 Fax +61 3 8660 1999 www.stbarbara.com.au

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King of the Hills – Definitive Mine Study confirms project viability.

Overview

The Definitive Mine Study for the King of the Hills gold project at Leonora, Western Australia, has confirmed the viability of the project, further reduced the project risk profile and underpinned an extension to the life of the project.

Site pre-production works have commenced and first gold production is due on schedule in June 2011.

The Tarmoola processing plant (on care and maintenance since 2004) has been sold for $3 million in cash, following the removal of the Tarmoola open pit resources from the Company’s Resource inventory.

Detail

1. King of the Hills – Definitive Mine Study confirms project viability.

The Definitive Mine Study has further refined the design criteria, mining schedules and cost estimates of the Pre-Feasibility Study completed in March 2010. The key points are summarised:

The Probable Ore Reserves have increased:

	Pre-feasibility Study	Definitive Mine Plan
Million tonnes	1,400	1,670
Grade (g/t Au)	4.3	4.3
Contained ounces	195,000	230,000

The Life of Mine, based on an expected mining inventory of 260,000[1] ounces of gold, is now approximately 5.5 years, with potential for further extension.

The Net Present Value of the project has marginally improved. An overall net increase in capital costs of $5.2 million is offset by the benefit of increased gold production. The average total cost over the current life of mine remains relatively unchanged at $1,020 - $1,050 per ounce of gold. The AUD gold price risk has been mitigated with a zero cost collar structure for 250,000 ounces of gold with a minimum price of $1,425 per ounce and a cap of $1,615 per ounce of gold over a 5 year period.

1 Assumes conversion of Inferred Resources not included in the Ore Reserve estimate

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St Barbara Limited ACN 009 165 066 Level 14, 90 Collins Street, Melbourne VIC 3000 Locked Bag 9, Collins Street East, Melbourne VIC 8003 Tel +61 3 8660 1900 Fax +61 3 8660 1999 www.stbarbara.com.au

Ore production from King of the Hills will be matched with available milling capacity at the Gwalia processing plant, and is estimated to be 450,000 tonnes per annum. Based on the Life of Mine grade of 4.3 g/t Au, annual gold production is estimated at 55,000 to 60,000 ounces per annum.

Negotiation of a mining contract for the project is substantially complete.

2. Tarmoola processing plant sold for $3 million.

As part of the Company’s capital asset management program, and following the removal of the Company’s low grade Tarmoola open pit mineral inventory from the Company’s Mineral Resources, the former Tarmoola processing plant, which has been on care and maintenance since 2004, has been sold for $3 million in cash.

The written down book value of the plant as at 30 June 2010 was approximately $1.8 million. Therefore, a net profit on sale of approximately $1.2 million is expected to be booked in the current fiscal year.

As a consequence of the purchaser removing the plant from site, St Barbara will avoid having to incur the cost of dismantling and disposing of the plant.

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Tim Lehany

Managing Director & CEO

1 Assumes conversion of Inferred Resources not included in the Ore Reserve estimate

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St Barbara Limited ACN 009 165 066 Level 14, 90 Collins Street, Melbourne VIC 3000 Locked Bag 9, Collins Street East, Melbourne VIC 8003 Tel +61 3 8660 1900 Fax +61 3 8660 1999 www.stbarbara.com.au

Competent Persons Statement

References to Ore Reserves presented in this document have been produced in accordance with the Australasian Code for Reporting of Mineral Resources and Ore Reserves, 2004 edition (JORC Code) under the direction of Mr. Peter Fairfield. Mr. Fairfield is a Member of The Australasian Institute of Mining and Metallurgy and is a full time employee of St Barbara. Mr. Fairfield has sufficient experience relevant to the style of mineralisation, type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the JORC Code. Mr. Fairfield consents to the inclusion in this document of the matters based on their information in the form and context in which it appears.

Members of the Company’s team preparing Ore Reserves Estimates under Mr. Fairfield’s supervision all qualify as Competent Persons.

1 Assumes conversion of Inferred Resources not included in the Ore Reserve estimate

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