ST BARBARA LIMITED — Interim / Quarterly Report 2011

Jan 17, 2011

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 December 2010 Quarterly Report www.stbarbara.com.au

Gwalia depth extensions confirmed

[including 10m @ 73g/t Au from 1,868mbs]

Overview

Production Summary

• Gold production of 60,673 ounces for the December 2010 quarter.

• Gold production of 124,161 ounces for the six months ended 31 December 2010.

Leonora Operations

• Gold production was 28,505 ounces for the December 2010 quarter at a cash operating cost of $874 per ounce.

• King of the Hills underground mine development is on schedule as at 31 December 2010.

• Gwalia mine will deliver increased gold production and lower unit costs in the second half, as the grade of the ore increases.

Southern Cross Operations

• Strong operating performance continues.

• Gold production of 32,168 ounces for the December 2010 quarter at a cash operating cost of $840 per ounce.

Finance and Corporate

• Gold shipped in the December 2010 quarter was 60,121 ounces, realising an average gold price of $1,390 per ounce.

• The Company expects to exceed by approximately 20% the previously published Net Profit After Tax guidance for the six months ended 31 December 2010 of $25.5 million, and will release its Half Year Report on 24 February 2011.

• Cash at bank at 31 December 2010 was $96 million.

Outlook

• Full year consolidated gold production is expected to be at the lower end of the FY11 production guidance range of 265,000 to 295,000 ounces. This represents a significant increase on FY10 gold production of 231,000 ounces.

• As a consequence of the lower Gwalia gold production to date, Gwalia’s cash operating costs for FY11 are expected to be at the upper end of guidance of $630 to $680 per ounce.

Discovery and Growth

• The first phase of deep drilling at Gwalia has confirmed the extension of the Gwalia ore body at depth from 1,640mbs to at least 1,900mbs, including outstanding intersections of:

• 7m @ 43 grams per tonne of gold (g/t Au) from 1,870mbs, including 1m @ 285g/t Au; and

• 10m @ 73g/t Au from 1,868mbs, including 0.45m @ 1,358g/t Au.

Health & Safety

==> picture [82 x 72] intentionally omitted <==

Tim Lehany Managing Director & CEO 18 January 2011

• The Total Recordable Injury Frequency Rate calculated as a rolling 12 month average improved significantly from 11.1 as at 30 September 2010 to 8.9 at 31 December 2010, reflecting a concerted effort to improve safety performance.

Note: All financial figures are in Australian dollars.

==> picture [138 x 43] intentionally omitted <==

December 2010 Quarterly Results

Operations

Consolidated Gold Production

Gold production was 60,673 ounces for the December 2010 quarter, and 124,161 ounces for the six months ended 31 December 2010.

==> picture [246 x 123] intentionally omitted <==

----- Start of picture text -----

koz Gold production ‐ last five quarters
70
60
50 62.6 63.5 60.7
55.1 54.4
40
30
20
10
FY 10 ‐ Q2 Dec FY 10 ‐ Q3 Mar FY 10 ‐ Q4 Jun FY 11 ‐ Q1 Sep FY 11 ‐ Q2 Dec
----- End of picture text -----

Production Summary	Sep Qtr FY11	Dec Qtr FY11
Leonora oz 30,005 28,505 Southern Cross oz 33,483 32,168 Consolidated oz 63,488 60,673 Total Cash Operating Costs Leonora $/oz 792 874 Southern Cross $/oz 801 840

Leonora Operations

Gwalia

Gold production for the December 2010 quarter of 28,505 ounces was disappointing. Operational mine planning and stope design issues were the main causes of lower head grade, lower production and higher unit costs for the quarter.

Mining and haulage performed well, delivering 183,641 tonnes of ore, achieving an annualised ore production rate of 735,000 tonnes per annum. The processing plant also continued to perform well and achieved recoveries of 95% for the quarter.

Equipment problems caused delays to the mining schedule in the first quarter. A number of measures were taken to recover the first quarter production slippage, including taking stopes from outside of the Ore Reserve in proximity to development, and increasing some stope sizes. The stopes taken from outside of Ore Reserve were lower grade, and consequently higher cost. Increased stope sizes resulted in some cases in overbreak, which in turn created ore dilution, increased handling costs and created consequential delays in the mine schedule.

These issues, which have been resolved, contributed to the lower grade, lower production and higher cash operating costs per ounce for the quarter.

The Leonora Operations management and mining contractor teams have been significantly strengthened over the last six months. In combination with improved mine planning and stope blasting designs, the overbreak

issues have been successfully addressed in the last two stopes mined and are not expected to recur.

Another contributing factor to the lower gold production for the quarter, as has previously been disclosed, was one South West Branch stope reporting a lower grade than originally expected. Localised grade variations to Ore Reserve for small volumes of ore on this scale are not unusual at the Gwalia mine. The South West Branch has been stoped or developed on 4 levels so far this financial year (2 above the dyke and 2 below the dyke). The understanding of this lode, and the geological controls over the distribution of gold within the lode, which contributes approximately 80% of the overall ore reserve at Gwalia, is improving substantially as a result.

Based on the strengthening geological understanding of grade distribution within the South West Branch lode, detailed mining plans will ensure the cost effective extraction of the ore from future stopes.

	Production Summary	Sep Qtr FY11	Dec Qtr FY11
	Underground ore mined t Grade g/t Ore milled t Grade g/t Recovery % Gold production oz Cash Operating Costs ($ per ounce) Mining Processing Site services Stripping and ore inventory adjustments By product credits Third party refining and transport costs Royalties Total cash operating costs Depreciation and amortisation Total operating costs	155,392 183,641 6.0 4.9 170,086 193,854 5.7 4.8 96 95 30,005 28,505 547 689 153 198 84 92 (26) (136)
		758 843 (2) (2) 1 1 35 32
		792 874 255 257
		1,047 1,131

Given the sequential nature of the mine production schedule, the delays, lower grade and incremental costs incurred were not recovered by the end of the December 2010 quarter. The Company is confident of a stronger second half, and achieving the lower end of production guidance for the full year.

As part of investing in the long term productivity of the mine, a number of underground infrastructure projects will be completed during the March 2011 quarter. These include a four bay underground workshop, an underground explosives magazine, and an underground fuel bay. A new underground pump station was completed in the December 2010 quarter.

Collectively, these projects are expected to reduce congestion in the decline and assist to underpin the long term reliable performance of the mine.

Page 2

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

King of the Hills

Decline development has advanced by 444 metres since commencing on 9 October 2010, and is expected to be at the depth of the first production level by the end of January 2011. First gold production remains on plan for the June 2011 quarter.

Site infrastructure construction and Leonora Village expansion were completed in the quarter on schedule and are fully functional.

Outlook for Leonora Operations

Full year gold production for Leonora Operations is likely to be at the lower end of the FY11 production guidance range of 155,000 ounces to 170,000 ounces. Gold production from Gwalia will progressively increase as the gold grade of the ore increases. A significantly stronger second half is expected.

The lower production from Gwalia in the six months ended 31 December 2010 means cash operating costs per ounce are expected to be at the upper end of guidance for FY11.

Southern Cross Operations

Gold production for the December 2010 quarter was 32,168 ounces, at a total cash operating cost of $840 per ounce, in line with expectations.

The December quarter production sources included Exhibition, New Lode and the higher grade northern stopes of Undaunted and Contact. The firing of the 430,000 tonne 365‐Exhibition pillar was successfully executed in December and will form the bulk of the process plant feed source for the second half of FY11.

	Production Summary	Production Summary	Sep Qtr FY11	Dec Qtr FY11
	Underground ore mined t 267,822 278,107 Grade g/t 3.4 3.8 Ore milled t 270,729 292,260 Grade g/t 4.1 3.7 Recovery % 93 93 Gold production oz 33,483 32,168 Cash Operating Costs ($ per ounce) Mining 490 466 Processing 224 239 Site services 72 76 Stripping and ore inventory adjustments (5) 37 781 818 By product credits (15) (14) Third party refining and transport costs 2 2 Royalties 33 34 Total cash operating costs 801 840 Depreciation and amortisation 157 161
		781 818 (15) (14) 2 2 33 34
		801 840 157 161
	Total operating costs	958 1,001

Outlook for Southern Cross Operations

With the main source of ore for the second half being the bulk low grade Exhibition lode, ore grades are expected to fall, and cash costs per ounce will increase, in line with the guidance range for the full year.

Published production and cost guidance for Southern Cross Operations for the 2011 financial year is maintained at between 110,000 to 125,000 ounces and $950 to $990 per ounce respectively.

Discovery and Growth (D&G)

The Discovery and Growth team continued drilling programs during the December 2010 quarter with a number of drill targets tested both near‐mine and regionally. Evaluation of new targets continued within the Company’s tenement holdings, and acquisition studies continued elsewhere on high priority areas.

Leonora Region

Gwalia : Deep resource extension drilling continued at Gwalia during the quarter with the aim of extending the resource from its current 1,640mbs to more than 1,800mbs (Figure 3). Drilling results to date confirm the extension of high grade gold mineralisation to at least 1,900mbs. Three wedge holes were completed during the quarter – GWDD 13B, 12E and 12F and a fourth GWDD 13C is nearly completed:

• GWDD 13B successfully intersected and further confirmed the down‐plunge extension of the central Gwalia lode system by over 200m depth to 1,930mbs, intersecting 6.7m @ 9.2g/t Au (approximately true width).

• Having delineated the Gwalia lode with the first two wedge holes, GWDD 12E and 12F were aimed at the main part of the Gwalia lode system ‐ GWDD 12E intersected 7m @ 43.6g/t Au, including 1m @ 285.2g/t; and GWDD 12F intersected 10m @ 73.3g/t Au including 4m @ 174g/t Au (all approximately true thicknesses of the lode system, refer to Table 1). These results are confirming the high grade gold tenor of the Gwalia lode system down to 1,800mbs.

At the end of the quarter, the next hole in the drilling programme, GWDD 13C, appears to be intersecting the Gwalia lode system, and based on this next result, it is expected that this deep drilling will continue to the end of the June quarter.

King of the Hills : A drill hole 200m from previous drilling north on the potential northern extension of the deposit intersected 2m @ 6.3g/t Au (down‐hole) from 684m. This intersection delineates gold mineralisation extending at least 800m north of the deposit as a guide to future near‐ mine exploration.

Hibernia prospect : An initial program of 32 reverse circulation (RC) drill holes totalling 4,230m was completed to test gold anomalies identified by air‐core geochemical drilling on the ‘Thunderbox Shear Zone’. This drill

Page 3

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

program covered both previously identified targets, Hibernia South and Hibernia North, returning moderately anomalous gold and arsenic results. All anomalous RC drill results are currently being sub‐sampled and results will be compiled early next quarter to plan further drill testing if warranted.

Southern Cross Region

Copperhead: The first hole of an initial drill program of six diamond drill holes is in progress. Four holes will test potential high grade underground zones within the largely unmined Western Lode and another two holes will test potential depth extensions of the previously mined Northern and Southern lodes. The drill programme will be completed during the March 2011 quarter.

Fraser’s South: Historic data compilation has been completed. An initial program of 6 holes to test potential high grade underground extensions is expected to commence early in the March 2011 quarter.

Other Areas

Geochemical air‐core drilling was completed over another two projects in the Yilgarn area, WA.

The Company’s targeting system for acquiring prospective ground positions has successfully identified and applied for a new area, referred to as Lake Carnage , located on the prospective Zulieka Shear Zone approximately 75km NW of Kalgoorlie, WA (Figure 6). Elsewhere, a major structural geology study of the Leonora province, with the aim of generating targets for further drill testing, has been completed.

Corporate

During the quarter the Company successfully completed its one‐for‐six share consolidation approved at the Company’s AGM in November 2010, and the voluntary share top‐up and share sale facilities. The unmarketable parcel share sale facility was launched in December and will conclude in March 2011.

The Company’s share capital structure as at 31 December 2010 was:

The Company’s share capital structu 2010 was:	re as at 31 December
Issued shares	325,615,389
Unlisted employee options	4,033,567
Unlisted performance rights	2,412,992

Outlook

The Company maintains previously published forward guidance for the current financial year, noting that consolidated gold production will be at the lower end of the guidance range of 265,000 to 295,000 ounces, and cash operating costs for Gwalia will be at the upper end of the guidance range of $630 to $680 per ounce.

Subject to finalisation of the six‐month audit review, the Company expects to exceed by approximately 20% the previously published Net Profit After Tax guidance for the six months ended 31 December 2010 of $25.5 million. This result is before the benefit from changes in the mark‐ to‐market value of gold options. The Company will release its Half Year Report on 24 February 2011.

East Lachlan Fold Belt (NSW) : During the December quarter a detailed gravity survey had been planned to test three main target areas for potential porphyry‐style copper‐gold mineralisation under younger cover rocks. However, because of recent heavy rain falls in the Nyngan area and following consultation with the landowners, this survey had to be postponed. Subject to no further heavy rains, this gravity survey will recommence early in the March 2011 quarter.

Health & Safety

The Total Recordable Injury Frequency Rate, calculated as a rolling 12 month average, reflected concerted safety improvement efforts during the quarter, improving from 11.1 at 30 September 2010 to 8.9 at 31 December 2010.

Financials (unaudited)

Gold shipped in the December 2010 quarter of 60,121 ounces was sold at an average price of $1,390 per ounce. Cash at bank was $96 million as at 31 December 2010, which did not include cash proceeds of $8.3 million from the sale of gold on 31 December 2010, received in January 2011.

Total interest bearing liabilities at 31 December 2010, comprising asset financing facilities, were $12.5 million.

Page 4

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

Corporate Directory

St Barbara Limited ABN: 36 009 165 066 Board of Directors

Colin Wise.......................................................... Chairman Tim Lehany .............................. Managing Director & CEO Doug Bailey ................................. Non‐Executive Director Phil Lockyer ................................. Non‐Executive Director Robert Rae ................................... Non‐Executive Director

Executive Team
Tim Lehany .............................. Managing Director & CEO
Garth Campbell‐Cowan ................. Chief Financial Officer
Ross Kennedy ............................ EGM Corporate Services
David Rose ................................... Chief Operating Officer
Phil Uttley ............................. EGM Discovery and Growth
Registered Office
Level 14, 90 Collins Street
Melbourne Victoria 3000
Telephone ............................................. +61 3 8660 1900
Facsimile ................................................ +61 3 8660 1999
Email ............................... melbourne@stbarbara.com.au
Website ...................................... www.stbarbara.com.au
Substantial Shareholders % of Holdings
As Notified
M&G Group* .......................................................... 18.1%
Franklin Resources ................................................... 6.0%
Hunter Hall Investment Management ..................... 5.1%
* M&G Group’s interest includes shares disclosed by Vanguard
Precious Metals & Mining Fund
Australian Securities Exchange Listing “SBM”
Shareholder Enquiries
Computershare Limited
GPO Box 2975
Melbourne Victoria 3001
Australia
Telephone (within Australia) ..................... 1300 653 935
Telephone (international) ..................... +61 3 9415 4356
Facsimile ................................................ +61 3 9473 2500
Financial figures are in Australian dollars.

Investor Relations Contacts

Ross Kennedy........................................+ 61 3 8660 1903 Xian Davies ...........................................+ 61 3 8660 1904

Page 5

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

Figure 1: Leonora Operations – Gwalia mine development

==> picture [455 x 268] intentionally omitted <==

Figure 2: Leonora Operations ‐ Gwalia Deeps

==> picture [343 x 332] intentionally omitted <==

Page 6

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

Figure 3: Leonora Operations – Gwalia Deeps drilling targets [cross section]

==> picture [455 x 286] intentionally omitted <==

Figure 4: Leonora Operations ‐ Gwalia Deep drilling targets [plan view]

==> picture [455 x 286] intentionally omitted <==

Page 7

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

Figure 5: Southern Cross D&G – Copperhead Planned Drilling of Western Lode

==> picture [455 x 285] intentionally omitted <==

Page 8

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

Figure 6: Leonora D&G – Regional

==> picture [455 x 312] intentionally omitted <==

Figure 7: Southern Cross D&G ‐ Regional

==> picture [229 x 317] intentionally omitted <==

Page 9

December 2010 Quarterly Results

==> picture [138 x 43] intentionally omitted <==

Table 1: Significant Intercepts

Hole No	North	East	Dip/Azi	Vertical	Lode	Mineralised Intersection	Mineralised Intersection	Mineralised Intersection
	(local)	(local)		Depth		From	Length	Gold
				mbs		mbs	m	g/t Au
LEONORA
Gwalia Deeps
GWDD12E	5711	9581	‐46/255	1710	South West Branch	1870	7.0	43.5
Incl. GWDD12E	5711	9580	‐46/255	1711	South West Branch	1875	1.0	285.1
GWDD12E	5700	9535	‐45/258	1758	South Gwalia Series	1938	6.4	4.6
GWDD12F	5667	9489	‐35/251	1629	South West Branch	1868	10.0	73.3
Incl. GWDD12F	5666	9491	‐35/251	1629	South West Branch	1868	4.0	174.7
Incl. GWDD12F	5668	9492	‐35/251	1626	South West Branch	1868	0.45	1358.4
GWDD13B	5652	9653	‐19/257	1756	South West Branch	2119	6.7	9.2
King of the Hills
TADD4111	11261	51014	‐53/283	592	Granite	684	2.0	6.3

Note:

1. Mineralised intersections are quoted as downhole lengths and uncut; nominal cut‐off grade 3g/t Au.

Competent Persons Statement

References to Exploration Results including significant gold intersections and geological interpretations contained in this report have been compiled by Mr. Phillip Uttley. Mr. Uttley is a Fellow of The Australasian Institute of Mining and Metallurgy and is a full time employee of the company. Mr. Uttley 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 in accordance with the Australasian Code for Reporting of Mineral Resources and Ore Reserves, December 2004 (JORC Code). Mr. Uttley consents to the inclusion in the report of the matters based on his information in the form and context in which they appear

Page 10