ST GEORGE MINING LIMITED — Capital/Financing Update 2011

Aug 23, 2011

ASX / MEDIA RELEASE

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ST GEORGE MINING LIMITED 24 August 2011

ASX: SGQ

ACN 139 308 973

Level 1, 115 Cambridge Street PO Box 1305, West Leederville WA 6007

www.stgeorgemining.com.au

UPDATE ON EXPLORATION AT PINE CREEK: VISIBLE GOLD

HIGHLIGHTS

Phone +618 9322 6600 Facsimile +618 9322 6610 Email info@stgm.com.au

• Fresh analysis of core from previous discovery holes at St George’s Pine Creek Property is being conducted

John Prineas

Executive Chairman

Tim Hronsky Technical Director

• Visible gold confirmed in core in of discovery hole FEND 18

• Leading edge CSIRO technology being used for drill core analysis

Marcus Michael

Non-Executive Director and Company Secretary

• New diamond drilling programme scheduled for Q4 2011

East Laverton Property:

• Gold

OVERVIEW

• Nickel

• Project Dragon (Nickel JV)

Pine Creek Property:

• Blue Thunder Gold Project

• White Strike Uranium Project

Austra l ian gold and nickel focused explorer, St George Mining Limite d ( ASX: SGQ ) ( ‘St George Mining’ or ‘the Company’ ) is pleased to pro v ide an update of exploration activities at t h e Blue Thunder Gold P roject located at its Pine Creek Property in the Northern Territory.

In advance of a diamond drilling p r ogramme at the Pine Creek Property scheduled for October 2011, St George Mining has been c onducting a comprehensive review, utilising industry leading technology to re-scan the historical d rill cores.

The previous explorer at the Pine C r eek Property, Homestake Gold of Australia L imited (“HGAL”), carried out a successful regional diamond drilling programme over a broad ar e a of the Fenton shear zone that included EL 27732, a tenement that now forms part of St Geo r ge Mining’s Pine Creek Property. HGAL was part of the Homestake Group, one of the largest global gold miners during the 1990’s, and now merged w ith Barrick Gold Corporation.

Carbon and sulphide-rich gold min e ralisation was intersected by HGAL at the c u rrent Pine Creek Property within the extensive and highly mineralised Koolpin Formation, which also hosts the Cosmo Howley gold mine about 30 km to the northeast. The most signif i cant broad drill intersections from the historical drill cores are listed in the tables below:

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HOLE ID	NORTHING	EASTING	DIP (degre es)	AZM (degrees)	DEPTH (m)	FROM (m)	TO (m)	WIDTH (m)	GRADE (g/t Au)
FEND 14	8472737	746928	-68	264	650	610	627	17	0.74
FEND 18	8471548	747190	-68	264	649	423	425	2	2.24
						431	433	2	4.89
					Inc.	431	432	1	8.68
						438	444	6	3.48
					Inc.	441	442	1	8.32
						463	464	1	1.81

Table 1- Higher grade intersections of F E ND 18 and FEND 14

VISIBLE GOLD

As part of its review of the historical d rill cores, the Company has identified visible gold within FEND 18. Figure 1 (below) shows the visible gold i n FEND18, at 424m down-hole depth, with a larg e grain circled.

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Figure 1 – Visible Gold in FEND18

The existence of visible gold in this en v ironment is very encouraging as it indicates the mineralsing fluids contained elevated levels of gold, in ex c ess of what could be absorbed by the carbon and sulphide rich host rocks, which form as free gold.

FEND 18 was the discovery drill-hole w ith significant high-grade intersections (see tabl e -1). It was drilled 1,200 m SSE of FEND 14 and intersect e d the higher grade gold zone approximately 200 m higher than the intersection in FEND 14. This confirms t he presence of a large gold system at the Comp a ny’s Blue Thunder Gold Project and the potential for verti c al and lateral extensions to the known gold mine r alisation.

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The HGAL drilling was based on magn e tic modeling of the interpreted pyrrhotite-rich m ineralisation and the current depths of the intersection s reflect this. The magnetic modeling would not h ave identified updip zones of oxidized gold mineralisati o n, where magnetic pyrrhotite appears to be alt e red non-magnetic pyrite. This suggests potential for up-dip extensions to the known mineralised zone.

The Cosmo Howley gold deposit, wher e 2+ MozAu has been recovered by open and und e rground mining, is also hosted by the Koolpin Formation and situated on the sheared eastern limb of a regi o nal anticline (Pine Creek Shear). The Company’s Blue Th u nder Gold Project is also hosted by the folded continuation of the Koolpin Formation.

Figure 2 (below) illustrates the proxim i ty of the Blue Thunder Gold Project relative to t he Cosmo Howley deposit. The close similarities between the geological structures at the Cosmo Howley d e posit and the Blue Thunder Gold Project provide addition a l support for the potential of up-dip mineralisati o n from the known gold intersections in FEND14 and FEND 1 8.

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Figure 2 – Regional Context of the Blu e Thunder Gold Project

CSIRO HyLogger

Both of the historical drill cores are being analysed using the CSIRO HyLogger hy p erspectral logging technology. The CSIRO HyLogger employs reflectance spectroscopy to determine the d iagnostic spectral features indicative of the mineralogy, m ineral chemistry and physical characteristics of d rill cores. Many of these factors are undetectable to the n a ked eye. A report on the results of this analysis is expected shortly.

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The information produced by the H y Logger will assist in evaluating the nature of the previous drill intersections: specifically, the relative position of FEND14 and FEND18 within the larger gold system, and the potential for rare earths and urani u m in that part of the Pine Creek Property. This in f ormation will also assist in future drill hole placement.

2011 Drilling Programme at Pine Creek

An orientated diamond drilling progr a mme is planned for the Pine Creek Property in October 2011. Previous core drilling by HGAL was no t orientated; as such, the structural orientation of the higher grade gold mineralisation can only be inferr e d from the previous drilling. A Mine Managem e nt Plan has been submitted to the Department of Resou r ces and finalisation of the Plan is expected withi n approximately 30 days.

The purpose of the diamond drilling pr o gramme will be to:

• Confirm the high grade interse c tions in FEND18

• Identify the up-dip potential of mineralisation and the “top” of the system

• Test the down dip extensions o f the ore shoot in this area

Further details of the 2011 drilling prog r amme will be announced after approval of the Mine Management Plan is obtained.

For further information, please contact: John Prineas David Brook Executive Chairman Professional Public Relations St George Mining Limited (+61) 08 9388 0944 mob 0415 09 6 804 (+61) 411 421 253 David.Brook@ppr.com.aua John.prineas@stgm.com.au

COMPETENT PERSON STATEMENT:

The information in this announcement tha t relates to Exploration Results and Mineral Resource s is based on information compiled by Andrew Hawker o f Hawker Geological Services Pty Ltd. Mr Hawker is a member of the Australasian Institute of Mining and M e tallurgy has sufficient experience, which is relevant t o the style of mineralisation and type of deposit under c o nsideration and to the activity, which he is undertaking. This qualifies Mr Hawker as a “Competent Pers o n” as defined in the 2004 edition of the ‘Australasia n Code for Reporting of Exploration Results, Mineral R esources and Ore Reserves’. Mr Hawker consents to t he inclusion of information in this announcement in th e form and context in which it appears.

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