Santa Fe Gold Reports Record $9.9 Million Revenue for 2013 Fiscal First Half

Santa Fe Gold Reports Record $9.9 Million Revenue for 2013 Fiscal First Half

ALBUQUERQUE, N.M.--(BUSINESS WIRE)-- Santa Fe Gold Corporation (OTCBB: SFEG) is pleased to announce financial results for the three and six months ended December 31, 2012. Revenues were $4.4 million for the three months ended December 31, 2012, representing a 127% increase over the same period of the prior year. Earnings from mining operations increased to $1.1 million for the three month period, a 90% increase over the same period a year ago. Revenues for the six months ended December 31, 2012 increased by 180% to a record $9.9 million, while earnings from mining operations increased by 142% to $3.3 million, also a record. The full version of the financial statements and management's discussion and analysis can be viewed on the Company's website at www.santafegoldcorp.com or on EDGAR at www.sec.gov.

"We are pleased with the strong growth in revenue and earnings from Summit mining operations," commented Pierce Carson, President and CEO. "Looking ahead, our high value gold and silver products are in strong demand and we expect a number of positive operational developments to contribute to Santa Fe's continued growth in the second half of fiscal 2013."

2013 Second Quarter and Six Month Financial and Operational Highlights

• 127% increase in revenue to $4.4 million for the three months ended December 31, 2012.

• 90% increase in earnings from mining operations to $1.1 million for the three months ended December 31, 2012.

• Gold and silver grades increased from 0.087 opt to 0.096 opt and 4.355 opt to 5.447 opt, respectively from Q1 2013 to Q2 2013.

• Gold equivalent production increased 8% from 4,023 ounces in Q1 2013 to 4,343 ounces in Q2 2013.

• Operating cash cost per gold equivalent ounce sold improved by 9% to US$916 in Q2 2013 compared to Q1 2013.

• Revenues for the six months ended December 31, 2012 increased 180% to a record $9.9 million.

• Earnings from mining operations were a record $3.3 million for the six months ended December 31, 2012, an increase of 142% over the same period a year earlier.

• Loss from Company operations was significantly impacted by higher depreciation and amortization charges and by exploration expenditures at the Ortiz gold project.

Outlook

• In February 2013 the Company began operating its Summit mine seven days a week, up from the previous five day schedule. The accelerated schedule is designed to increase tonnage output and to expedite the drive downward to the main high grade ore zone. The main ore zone has significantly higher grades in resource modeling as compared to the currently active upper mining areas. Mining from the main zone is scheduled to begin in mid-2013 and is anticipated to result in an overall increase in gold and silver production.

• Santa Fe recently announced a $12 million smelter contract for the sale of high-value gold-silver concentrates produced at its 100% owned Lordsburg flotation mill. The new contract represents an additional market outlet for concentrates from the Summit mine operations. In addition to concentrate sales, during 2013 the Company anticipates continuing to sell a substantial portion of Summit output in the form of silica flux material to smelters in Arizona. Sale of silica flux involves direct shipment of ore with only minimal processing required.

• In October 2012 Santa Fe concluded an option agreement with Columbus Silver Corporation to purchase the Mogollon Project, Catron County, New Mexico, in exchange for payments totaling $4.5 million thorough 2014. The Mogollon district has recorded substantial historical production of silver and gold. The Company is focused on known drilled resources that have potential to be mined and processed at the Lordsburg mill.

• The Lordsburg flotation mill constitutes a long term strategic asset with flexibility to handle a variety of ore types and has significant extra processing capacity. In addition to the Summit mine, the Company plans to place a strong emphasis on developing new sources of ore for the mill and thereby build Santa Fe's production profile.

• The Ortiz Gold Project contains undeveloped gold deposits that provide important additional upside to Santa Fe's future. Previous drilling was focused on two deposits estimated to contain approximately 1.0 million ounces of gold within open pit designs. A Canadian standard NI 43-101 technical report is being prepared on these two deposits and will be completed in the near future.

• In October 2012 Santa Fe announced a Heads of Agreement to merge with International Goldfields Ltd (IGS: ASX). Perceived benefits of the merger include enhancement of the combined company's cash position, listing of the company's stock on a senior US exchange as well as continued listing on the ASX, and an expanded portfolio of precious metals properties. The parties expect to finalize the definitive merger agreement shortly and estimate the merger could close in the second calendar quarter of 2013.

About Santa Fe Gold

Santa Fe Gold is a U.S.-based mining and exploration enterprise focused on acquiring and developing gold, silver, copper and industrial mineral properties. Santa Fe controls: (i) the Summit mine and Lordsburg mill in southwestern New Mexico, which began commercial production in 2012; (ii) a substantial land position near the Lordsburg mill, comprising the core of the Lordsburg Mining District; (iii) the Mogollon gold-silver project, within trucking distance of the Lordsburg mill; (iv) the Ortiz gold property in north-central New Mexico; (v) the Black Canyon mica deposit near Phoenix, Arizona; and (vi) a deposit of micaceous iron oxide (MIO) in western Arizona. Santa Fe Gold intends to build a portfolio of high-quality, diversified mineral assets with an emphasis on precious metals.

To learn more about Santa Fe Gold, visit www.santafegoldcorp.com.

FORWARD-LOOKING AND CAUTIONARY STATEMENTS - SAFE HARBOR

This press release contains forward-looking statements, including with respect to the negotiation, implementation and effects of a proposed business combination between Santa Fe Gold Corporation ("Santa Fe") and International Goldfields Limited ("IGS"), that may result from the Heads of Agreement. Those statements and statements made in this release that are not historical in nature, including those related to future benefits, increases in shareholder value, synergies, improved liquidity and profitability, constitute forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of words such as "expects," "projects," "plans," "will," "may," "anticipates," believes," "should," "intends," "estimates," and other words of similar meaning. These statements are based on current plans, estimates and projections, and, therefore, you should not place undue reliance on them. These statements are subject to risks and uncertainties that cannot be predicted or quantified, and our actual results may differ materially from those expressed or implied by such forward-looking statements. For Santa Fe, these statements are subject to the following risks and uncertainties: difficulties, delays, unexpected costs or the inability to reach definitive documents with respect to, or consummate, the proposed business combination with IGS and other transactions referred to in this press release and those described in the documents we file with the U.S. Securities and Exchange Commission, and risks associated with the inherent uncertainty of future financial results, and additional capital financing requirements. All forward-looking statements included in this release are made as of the date of this press release, and Santa Fe assumes no obligation to update any such forward-looking statements.

STATEMENT REGARDING ADDITIONAL INFORMATION THAT MAY BECOME AVAILABLE

If a transaction is to be proposed to the stockholders of Santa Fe and IGS, Santa Fe and IGS would file with the Securities and Exchange Commission and distribute a Registration Statement on Form F-4 covering securities to be issued in the transaction. Santa Fe shareholders would receive a prospectus and proxy/consent solicitation statement in connection with such transaction. The final terms of the prospective merger of Santa Fe and IGS remain subject to change and would only be reflected in a binding definitive agreement that remains to be negotiated between the companies. Santa Fe stockholders would be urged to read these and any other related documents the corporation may issue. If and when these documents are filed, they can be obtained for free at the SEC's website, www.sec.gov. Additional information on how to obtain these documents from Santa Fe would be made available to stockholders if and when a transaction is to occur. IGS would provide disclosure and arrange for solicitation of the votes of its shareholders in accordance with Australian regulations following execution of a binding agreement. Such documents are not currently available.

This communication shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. Santa Fe, its directors and executive officers, may be deemed to be participants in the solicitation of proxies or consents from Santa Fe's stockholders in connection with any transaction that might be proposed to such stockholders. Information about the directors and executive officers of Santa Fe and their ownership of IGS and Santa Fe stock will be included in the prospectuses and proxy/consent solicitation statements if and when they become available.

See Accompanying Tables

The following information summarizes the financial condition of Santa Fe Gold Corporation at December 31, 2012, including its balance sheets at December 31, 2012 and June 30, 2012, respectively, its results of operations for the three months and six months ended December 31, 2012 and 2011, respectively, and its cash flows for the six months ended December 31, 2012 and 2011. The summary data for the three and six months ended December 31, 2012 and 2011, respectively, are unaudited; the summary data for the financial year ended June 30, 2012 are taken from our audited financial statements contained in our annual report on Form 10-K for the financial year ended June 30, 2012, but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company's Form 10-K in its entirety, which can be found on the SEC's website atwww.sec.gov.