St Barbara Mines Limited Annual Report 2004 NuStar Investment “St Barbara facilitated the development of Paulsens Project  through a balance sheet capital reconstruction of subsidiary  company NuStar Mining Corporation. Paulsens, now fully debt  and equity funded is on schedule for the  fi  rst gold pour in May 2005.” At the commencement of the  fi  nancial year St Barbara  held an 88.3% interest in NuStar Mining Corporation  Limited (formerly Taipan Resources NL). Detailed mine planning established a mining reserve  of 1.20 million tonnes at 10.66 g/t – containing  412,100 ounces of gold. The reserve is based on the Indicated Resource above  900MRL (300 metres below surface) and under Joint Ore  Reserves Committee guidelines is classi fi  ed as probable. Full allowance has been made for dilution and ore loss  during mining. Early in the year the design concept for the 100% owned  Paulsens Project in the Ashburton region of Western  Australia changed from a high strip ratio open pit to a  high grade shallow underground mine. In December 2003, NuStar raised equity to  fi  nance  the development of the mine and to complete a resource  extension drill programme. As a result of the equity raise, and a shareholder approved  debt for equity swap, the St Barbara interest in NuStar was  diluted to 54.8%. During the year, the resource was increased by 59%,  a mine reserve of 412,100 ounces was declared, the site  infrastructure was established and the underground mine  decline commenced. Post year end a debt funding package was secured from  Westpac Banking Corporation to construct an on-site  treatment plant and to purchase the St Barbara owned  5% gross revenue royalty over Paulsens production. The underground mine has been designed to deliver  250,000 tonnes per annum of ore via a 5 metre by  5.5 metre decline with a 1:6 gradient. The mine plan anticipates ore development on  7.5 metre to 10 metre vertical level intervals. Stoping will be predominantly up-hole benching and  jumbo stripping. Some hand held mining is envisaged. At the date of this report, St Barbara commenced a  structured sell down of its holding in NuStar, the details  of which are described elsewhere in this document. JR Roche completed a  fl  ow sheet design for a  250,000 tonne per annum plant based on extensive  metallurgical testwork conducted in prior years. The process design comprised a three stage crushing,  single ball mill in closed circuit, seven stage  carbon-in-leach circuit and an AARL elution gold  recovery circuit. The process design allowed for a  fi  ne  grind to achieve gold liberation (80% passing 53 microns)  and the presence of minor carbonaceous material in a  small part of the orebody. Construction on site is scheduled for November 2004. A JORC compliant resource estimate, incorporating the  result of the February/June 2004 Resource Extension  program, was completed by independent Resource  Evaluations Pty Ltd. The estimate data base comprised 270 holes  (96 NQ diamond core and 174 percussion holes –  48,400 metres) drilled at 25 metre by 25 metre spacings  on sections in the better mineralised portion of the deposit. The calculated estimate of 1.44 million tonnes at  11.7 g/t places 89% of the 541,300 contained ounces in  the Indicated category. The estimate incorporates an assay  top-cut to limit the in fl  uence of a signi fi  cant number of high grade intercepts. The un-cut average grade is 13.1 g/t. The orebody remains open at depth, with the resource  potential below 300 metres only partially evaluated. Mine Reserve Background Mine Design Treatment Plant Resource Estimate