content_image/88512.jpg content_image/88513.jpg
Prior to 30 June 2004, the Company had divested itself of previously 100% owned substantial land holdings at Meekatharra. This occurred by entry into a number of joint venture agreements with the incoming parties earning a fully participating joint venture interest by contributing exploration funds over some years in priority to the Company. These arrangements will require an expenditure of $6.5m during the 12 month period ending 30 June 2005. 

This level of expenditure will result in considerable drilling activity on a number of highly prospective targets. In all but one of these joint ventures, St Barbara continues as the manager of the joint venture. 

The Bluebird treatment plant, 15 kilometres south of Meekatharra, has a 3 million tonnes per annum capacity but is currently idle and on care and maintenance. Its estimated replacement cost exceeds $50 million and as a consequence, the early re-commencement of plant operations remains an important strategic objective for the Company to pursue and is one of the key reasons behind the Company’s decision to immediately commence drilling of several targets at Paddy’s Flat. A prime objective in this regard is to re-establish gold production and positive cash fl  ow at the Bluebird processing plant. 

Australia is and remains highly prospective for gold, copper and nickel. The increase in demand for all metals and subsequent increase in metal prices has improved the attractiveness of exploring for these metals. 

A number of opportunities which may lead to the discovery of large mineral deposits are being pursued by St Barbara. Our principal focus will be in Western Australia and Queensland. Exploration will be balanced between grass roots conceptual targeting and brown fi  elds exploration seeking to extend the known mineralisation. Our initial exploration budget including drilling, on 100% owned targets for the balance of the 2005 fi  nancial year, is expected to be in the range $3.0 - $3.5 million, and will be funded from working capital. 

We believe that with metals markets continuing in a strong growth phase, there are currently some exciting opportunities in Australia. 

<img src='content_image/88512.jpg'>

<img src='content_image/88513.jpg'>

