ALCHEMY RESOURCES LIMITED - Capital/Financing Update 2008

ALCHEMY RESOURCES LIMITED ACN 124 444 122

ENTITLEMENT ISSUE PROSPECTUS

For a non-renounceable entitlement issue of one (1) Option for every two (2) Shares held by Shareholders registered at 5.00pm (WST) on 11 June 2008 at an issue price of one (1) cent per Option to raise up to approximately $198,000 ( Offer ).

The Offer will not be underwritten.

IMPORTANT NOTICE

This document is important and should be read in its entirety. If after reading this Prospectus you have any questions about the securities being offered under this Prospectus or any other matter, then you should consult your stockbroker, accountant or other professional adviser.

The securities offered by this Prospectus should be considered as speculative.

1.	SUMMARY OF IMPORTANT DATES AND IMPORTANT NOTES ................3
2.	CORPORATE DIRECTORY........................................................................................4
3.	CHAIRMAN’S LETTER ...............................................................................................5
4.	DETAILS OF THE OFFER ...........................................................................................6
5.	PURPOSE AND EFFECT OF THE OFFER..............................................................10
6.	RIGHTS AND LIABILITIES ATTACHING TO THE OPTIONS......................13
7.	RISK FACTORS...........................................................................................................16
8.	ADDITIONAL INFORMATION..............................................................................20
9.	AUTHORITY OF DIRECTORS ................................................................................26
10.	DEFINITIONS..............................................................................................................27

TIMETABLE AND IMPORTANT DATES

Lodgement of Prospectus with ASIC	29 May 2008
Notice sent to Shareholders	30 May 2008
Shares quoted on an “ex” basis	4 June 2008
Record Date for determining entitlements to Options	11 June 2008
Opening Date and Prospectus despatched to Shareholders	13 June 2008
Closing Date of Offer	9 July 2008
Options quoted on a deferred settlement basis	10 July 2008
Dispatch of holding statements	16 July 2008

These dates are determined upon the current expectations of the Directors and may, subject to the Listing Rules, be changed without notice. The Directors may extend the Closing Date by giving at least 6 business days notice to ASX prior to the Closing Date. As such the date the Options are expected to commence trading on ASX may vary.

1. IMPORTANT NOTES

Shareholders should read this document in its entirety and, if in doubt, should consult their professional advisors.

This Prospectus is dated 29 May 2008 and a copy of this Prospectus was lodged with the ASIC on that date. The ASIC and ASX take no responsibility for the content of this Prospectus.

The expiry date of the Prospectus is 29 June 2009 ( Expiry Date ). No Options will be allotted or issued on the basis of this Prospectus after the Expiry Date.

The distribution of this Prospectus in jurisdictions outside Australia and New Zealand may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe any of these restrictions. Failure to comply with these restrictions may violate securities laws. Applicants who are resident in countries other than Australia and New Zealand should consult their professional advisers as to whether any governmental or other consents are required or whether any other formalities need to be considered and followed.

No person is authorised to give information or to make any representation in connection with this Prospectus which is not contained in the Prospectus.

In making representations in this Prospectus regard has been had to the fact that the Company is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential investors may consult.

Please read this document carefully before you make your decision to accept the Offer. An investment in the Company has specific risks which you should consider before making a decision to invest.

Certain terms and abbreviations used in this Prospectus have defined meanings which are set out in the Glossary.

This Prospectus is a transaction specific prospectus for an offer of Options to acquire continuously quoted securities (as defined in the Corporations Act) and has been prepared in accordance with Section 713 of the Corporations Act. It does not contain the same level of disclosure as an initial public offering prospectus. In making representations in this Prospectus regard has been had to the fact that the Company is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential advisers may consult.

This Prospectus may be issued as an electronic prospectus. The Offer of Options pursuant to this Prospectus is available to persons receiving an electronic version of this Prospectus within Australia. The Corporations Act prohibits any person from passing an Acceptance Form to another person unless it is attached to or accompanies the complete and unaltered version of this Prospectus. The Prospectus may be viewed online at: www.alchemyresources.com.au.

2. CORPORATE DIRECTORY

	Directors Mr Warwick Davies (Non Exec. Chairman) Mr Michael Hannington (Managing Director) Mr John Arbuckle (Non Exec. Director) Mr Robert Downey (Non Exec. Director) Company Secretary Mr John Arbuckle Registered Office 1186 Hay Street West Perth WA 6005 Telephone (08) 9481 4400 Facsimile (08) 9481 4404	Share Registry Security Transfer Registrars Pty Ltd 770 Canning Highway Applecross WA 6153 PO Box 535 Applecross WA 6953 Telephone: (08) 9315 2333 Facsimile: (08) 9315 2233

This party is included for information purposes only. It has not been involved in the preparation of this Prospectus and has not consented to being named in this Prospectus.

3. CHAIRMAN’S LETTER

Dear Shareholder

The Board of Alchemy Resources Limited is pleased to offer Shareholders the opportunity to participate in a one (1) for two (2) non-renounceable entitlements issue of Options exercisable at $0.25 each on or before 31 August 2010 to all shareholders registered as at 5.00pm (WST) on 11 June 2008 at an issue price of 1 cent per Option.

The Offer will raise approximately $198,000 before expenses. Funds raised will be applied towards exploration and working capital.

Alchemy continues to pursue its core strategy of exploring its highly prospective portfolio of tenements in the Murchison district of Western Australia in the most cost effective manner possible.

The Board takes this opportunity to thank all Shareholders for their support since listing and looks forward to your continued support in the future.

Yours sincerely,

Warwick Davies Non-Executive Chairman

4. DETAILS OF THE OFFER

4.1 Offer of Options

The Offer is being made as a non-renounceable entitlement issue of one (1) Option for every two (2) Shares held by Shareholders registered at 5.00pm (WST) on the Record Date at an issue price of 1 cent per Option. Fractional Entitlements will be rounded up to the nearest whole number.

The Options are exercisable at $0.25 each on or before 31 August 2010.

Based on the capital structure of the Company, the maximum number of Options to be issued pursuant to this Offer is 19,800,000. The Offer will raise up to approximately $198,000.

Funds raised from the Offer will be applied towards exploration on the Company’s Murchison tenements and working capital.

4.2 How to Accept the Offer

Your acceptance of the Offer must be made on the Entitlement and Acceptance Form accompanying this Prospectus. Your acceptance must not exceed your Entitlement as shown on that form. If it does, your acceptance will be deemed to be for the maximum Entitlement.

You may participate in the Offer as follows:

(a) if you wish to accept your Entitlement in full:
(i) complete the Entitlement and Acceptance Form, filling in the details in the spaces provided; and
(ii) attach your cheque for the amount indicated on the Entitlement and Acceptance Form; or
(b) if you only wish to accept part of your Entitlement:
(i) fill in the number of Options you wish to accept in the space provided on the Entitlement and Acceptance Form; and
(ii) attach your cheque for the appropriate application monies (at $0.01 per Option); or
(c) if you do not wish to accept all or part of your Entitlement, you are not obliged to do anything.

All cheques must be drawn on an Australian bank or bank draft made payable in Australian currency to “Alchemy Resources Limited – Option Account” and crossed “Not Negotiable” .

Your completed Entitlement and Acceptance Form and cheque must reach the Company’s share registry no later than 5:00pm (WST) on the Closing Date.

The Offer is non-renounceable. Accordingly, a holder of Shares may not sell or transfer all or part of their Entitlement.

4.3 Australian Securities Exchange Listing

Application for official quotation by ASX of the Options offered pursuant to this Prospectus will be made within 7 days after the date of this Prospectus. If approval is not obtained from ASX before the expiration of 3 months after the date of issue of the Prospectus, (or such period as varied by the ASIC), the Company will not issue any Options and will repay all application monies for the Options within the time prescribed under the Corporations Act, without interest.

The fact that ASX may grant official quotation to the Options is not to be taken in any way as an indication of the merits of the Company or the Options now offered for subscription.

4.4 Minimum Subscription

There is no minimum subscription in respect of the Offer.

4.5 Shortfall Offer

Any Entitlement not taken up pursuant to the Offer will form the Shortfall. The Directors reserve the right to issue Shortfall Options at their absolute discretion. Accordingly, Shareholders who may wish to subscribe for Shortfall Options are invited to complete the Shortfall Application Form accompanying this Prospectus and return it to the Company together with a cheque for the value of the Shortfall Options. This cheque should be separate from any cheque for Entitlement Options.

The Directors reserve the right to allot to an Applicant a lesser number of Shortfall Options than the number for which the Applicant applies for on their Shortfall Application Form, or to reject an application, or to not proceed with placing the Shortfall.

The offer of any Shortfall Options is a separate offer made pursuant to this Prospectus and will remain open for up to three (3) months following the Closing Date. The issue price of any Shortfall Options shall be 1 cent being the price at which the Entitlement has been offered to Shareholders pursuant to this Prospectus.

4.6 Underwriting

The Offer will not be underwritten.

4.7 Allotment of Options

Options issued pursuant to the Offer will be allotted as soon as practicable after the Closing Date. The Company will allot the Options on the basis of a Shareholder’s Entitlement.

Pending the allotment and issue of the Options or payment of refunds pursuant to this Prospectus, all application monies will be held by the Company in trust for the Applicants in a separate bank account as required by the Corporations Act. The Company, however, will be entitled to retain all interest that accrues on the bank account and each Applicant waives the right to claim interest.

4.8 Overseas Shareholders

This Offer does not, and is not intended to, constitute an offer in any place or jurisdiction in which, or to any person to whom, it would not be lawful to make such an offer or to issue this Prospectus.

It is the responsibility of foreign shareholders to obtain all necessary approvals for the allotment and issue to them of Options pursuant to this Prospectus.

4.9 Electronic Prospectus

This Prospectus will be issued in paper form and as an electronic prospectus. The Offer constituted by this Prospectus in electronic form is available only to persons receiving this Prospectus in electronic form in Australia. The Corporations Act prohibits any person from passing onto another person an acceptance form unless it is attached to or accompanied by a complete and unaltered version of this Prospectus. Whilst the Offer is open, any person may obtain a hard copy of this Prospectus by contacting the Company using the correct details set out in the Corporate Directory.

4.10 Taxation Implications

The Directors do not consider that it is appropriate to give Applicants advice regarding the taxation consequences of applying for Options under this Prospectus, as it is not possible to provide a comprehensive summary of the possible taxation consequences. The Company, its advisers and officers, do not accept any responsibility or liability for any taxation consequences to Applicants. Potential Applicants should, therefore, consult their own professional tax adviser in connection with the taxation implications of the Options offered pursuant to this Prospectus.

4.11 Privacy Act

If you complete an application for Options, you will be providing personal information to the Company (directly or by the Company’s share registry). The Company collects, holds and will use that information to assess your application, service your needs as a Shareholder, facilitate distribution payments and corporate communications to you as a Shareholder and carry out administration.

The information may also be used from time to time and disclosed to persons inspecting the register, bidders for your securities in the context of takeovers, regulatory bodies, including the Australian Taxation Office, authorised securities brokers, print service providers, mail houses and the Company’s share registry.

You can access, correct and update the personal information that we hold about you. Please contact the Company or its share registry if you wish to do so at the relevant contact numbers set out in this Prospectus.

Collection, maintenance and disclosure of certain personal information is governed by legislation including the Privacy Act 1988 (Cth) (as amended), the Corporations Act and certain rules such as the ASTC Settlement Rules. You should note that if you do not provide the information required on the application for Options, the Company may not be able to accept or process your application.

4.12 Enquiries

Any questions concerning the Offer should be directed to the Company Secretary, John Arbuckle, on (08) 9481 4400.

5. PURPOSE AND EFFECT OF THE OFFER

5.1 Purpose of the Offer

The purpose of the Offer is to raise approximately $198,000 (before expenses). The funds raised from the Offer will be applied towards exploration expenditure, general working capital and expenses of the Offer.

5.2 Effect of the Offer and Pro Forma Balance Sheet

The principal effect of the Offer will be to:

(a) increase the cash reserves by approximately $198,000 immediately after completion of the Offer (before deducting the estimated expenses of the Offer); and
(b) increase the number of Options on issue from 15,568,750 as at the date of this Prospectus to approximately 35,368,750 Options, on the basis that the Offer is fully subscribed.

5.3 Balance Sheet

Set out below is:

(a) an interim reviewed consolidated balance sheet as at 31 December 2007; and
(b) an unaudited pro forma consolidated balance sheet of the Company as at 31 December 2007 incorporating and assuming:
(i) the Offer of 19,800,000 Options at 1 cent each to raise approximately $198,000; and
(ii) the payment of cash costs of $7,010 (which are payable from the proceeds of the Offer).

The interim reviewed consolidated balance sheet and the unaudited pro forma consolidated balance sheet as at 31 December 2007 shown on the following page have been prepared on the basis of the accounting policies normally adopted by the Company and reflect the changes to its financial position. They have been prepared on the assumption that all Options pursuant to this Prospectus are issued.

Pro Forma Balance Sheet as at 31 December 2007

The interim reviewed consolidated balance sheet at 31 December 2007 and the unaudited pro-forma consolidated balance sheet at that date, adjusted for the proceeds from the options issue, are set out below.

Current Assets Cash and cash equivalents Trade and other receivables Total Current Assets Non-Current Assets Exploration and evaluation Property, plant and equipment Total Non-Current Assets Total Assets Current Liabilities Trade and other payables Total Current Liabilities Total Liabilities Net Assets Equity Issued capital Reserves Accumulated losses Total Equity	31 December 2007 Interim Reviewed Consolidated $ 4,444,103 57,429 4,501,532 290,231 3,945 294,176 4,795,708 69,340 69,340 69,340 4,726,368 4,884,381 299,923 (457,936) 4,726,368	31 December 2007 Unaudited Pro Forma Consolidated $ 4,635,093 57,429
		4,692,522
		290,231 3,945
		294,176
		4,986,698
		69,340
		69,340
		69,340
		4,917,358
		5,075,371 299,923 (457,936)
		4,917,358

5.4 Effect on Capital Structure

Upon completion of the Offer, the capital structure of the Company will be:

Shares
	Number
Current Shares on issue	39,600,000
Shares offered pursuant to the Offer	Nil
Total Shares on issue after completion of Offer	39,600,000

Options

	Number
Current Options on issue	15,568,750
Options offered pursuant to the Offer	19,800,000
Total Options on issue after completion of Offer	35,368,750

6. RIGHTS AND LIABILITIES ATTACHING TO THE OPTIONS

6.1 Terms and Conditions of Options

The Options will entitle the holders to subscribe for fully paid ordinary shares in the Company on the following terms:

(a) Each Option entitles the holder to subscribe for and be allotted one ordinary fully paid share in the Company.
(b) The Options are exercisable at 25 cents each ( Exercise Price ).
(c) The Options will expire on 31 August 2010 ( Expiry Date ).
(d) The Options are exercisable at any time on or prior to the Expiry Date by notice in writing to the Directors accompanied by payment of the Exercise Price.
(e) The Options are freely transferable.
(f) All shares issued upon exercise of the Options will rank pari passu in all respects with the Company’s then existing ordinary fully paid shares. The Company will apply for Official Quotation by the ASX of all Shares issued upon exercise of the Options.
(g) There are no participating rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options. However, if from time to time on or prior to the Expiry Date the Company makes an issue of new Shares to Shareholders, the Company will announce the issue to ASX prior to the record date in accordance with the requirements of the ASX Listing Rules. This will give holders of Options the opportunity to exercise their Options prior to the date for determining entitlements to participate in any such issue.
(h) There is no right to a change in the Exercise Price of the Options or to the number of Shares over which the Options are exercisable in the event of a new issue of capital (other than a bonus issue) during the currency of the Options.
(i) In the event of any reorganisation of the issued capital of the company on or prior to the Expiry Date, the rights of an Optionholder will be changed to the extent necessary to comply with the applicable ASX Listing Rules in force at the time of the reorganisation.

6.2 Rights Attaching to Shares

The following summary of the more significant rights and liabilities attaching to Shares issued upon conversion of the Options. Full details of the rights attaching to Shares are set out in the Constitution, a copy of which is available for inspection at the Company’s registered office during normal business hours.

The rights, privileges and restrictions attaching to Shares can be summarised as follows:

(a) General Meetings

Shareholders are entitled to be present in person, or by proxy, attorney or representative to attend and vote at general meetings of the Company.

Shareholders may requisition meetings in accordance with Section 249D of the Corporations Act and the Constitution of the Company.

(b) Voting Rights

Subject to any rights or restrictions for the time being attached to any class or classes of Shares, at general meetings of shareholders or classes of shareholders:

(i) each Shareholder entitled to vote may vote in person or by proxy, attorney or representative;
(ii) on a show of hands, every person present who is a Shareholder or a proxy, attorney or representative of a Shareholder has one vote; and
(iii) on a poll, every person present who is a Shareholder or a proxy, attorney or representative of a Shareholder shall, in respect of each fully paid share held by him, or in respect of which he is appointed a proxy, attorney or representative, have one vote for the share, but in respect of partly paid Shares shall have such number of votes as bears the same proportion to the total of such Shares registered in the Shareholder’s name as the amount paid (not credited) bears to the total amounts paid and payable (excluding amounts credited).

(c) Dividend Rights

Subject to the rights of persons (if any) entitled to Shares with special rights to dividend the Directors may declare a final dividend out of profits in accordance with the Corporations Act and may authorise the payment or crediting by the Company to the Shareholders of such a dividend. The Directors may authorise the payment or crediting by the Company to the Shareholders of such interim dividends as appear to the Directors to be justified by the profits of the Company. Subject to the rights of persons (if any) entitled to shares with special rights as to dividend all dividends are to be declared and paid according to the amounts paid or credited as paid on the Shares in respect of which the dividend is paid. Interest may not be paid by the Company in respect of any dividend, whether final or interim.

(d) Winding-Up

If the Company is wound up, the liquidator may, with the authority of a special resolution of the Company, divide among the Shareholders in kind the whole or any part of the property of the Company, and may for that purpose set such value as he considers fair upon any property to be so divided, and may determine how the division is to be carried out as between the Shareholders or different classes of Shareholders.

The liquidator may, with the authority of a special resolution of the Company, vest the whole or any part of any such property in trustees upon such trusts for the benefit of the contributories as the liquidator thinks fit, but so that no shareholder is compelled to accept any shares or other securities in respect of which there is any liability. Where an order is made for the winding up of the Company or it is resolved by special resolution to wind up the Company, then on a distribution of assets to members, Shares classified by ASX as restricted securities at the time of the commencement of the winding up shall rank in priority after all other shares.

(e) Transfer of Shares

Generally, Shares in the Company are freely transferable, subject to formal requirements, the registration of the transfer not resulting in a contravention of or failure to observe the provisions of a law of Australia and the transfer not being in breach of the Corporations Act or the Listing Rules.

(f)

Variation of Rights

Pursuant to Section 246B of the Corporations Act, the Company may, with the sanction of a special resolution passed at a meeting of shareholders vary or abrogate the rights attaching to shares.

If at any time the share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class), whether or not the Company is being wound up may be varied or abrogated with the consent in writing of the holders of three-quarters of the issued shares of that class, or if authorised by a special resolution passed at a separate meeting of the holders of the shares of that class.

7. RISK FACTORS

7.1 Introduction

An investment in the Company is not risk free and prospective new investors should consider the risk factors described below, together with information contained elsewhere in this Prospectus, before deciding whether to apply for Options.

The following is not intended to be an exhaustive list of the risk factors to which the Company is exposed.

7.2 Exploration Success

The mineral tenements of the Company are at various stages of exploration, and potential investors should understand that mineral exploration and development are high-risk undertakings.

There can be no assurance that exploration of the tenements, or any other tenements that may be acquired in the future, will result in the discovery of an economic ore deposit. Even if an apparently viable deposit is identified, there is no guarantee that it can be economically exploited.

The exploration costs of the Company are based on certain assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from these estimates and assumptions. Accordingly, no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect the Company’s viability.

7.3 Economic Risks

General economic conditions, movements in interest and inflation rates and currency exchange rates may have an adverse effect on the Company’s exploration, development and production activities, as well as on its ability to fund those activities.

Further, share market conditions may affect the value of the Company’s quoted securities regardless of the Company’s operating performance. Share market conditions are affected by many factors such as:

(a) general economic outlook;
(b) interest rates and inflation rates;
(c) currency fluctuations;
(d) changes in investor sentiment toward particular market sectors;
(e) the demand for, and supply of, capital; and
(f) terrorism or other hostilities.

7.4 Resource Estimates

Resource estimates are expressions of judgement based on knowledge, experience and industry practice. Estimates which were valid when originally calculated may alter significantly when new information or techniques become available. In addition, by their very nature, resource estimates are imprecise and depend to some extent on interpretations, which may prove to be inaccurate. As further information becomes available through additional fieldwork and analysis, the estimates are likely to change. This may result in alterations to development and mining plans which may, in turn, adversely affect the Company’s operations.

7.5 Market Conditions

The market price of quoted securities can fall as well as rise and may be subject to varied and unpredictable influences on the market for equities in general and resource exploration stocks in particular. Neither the Company nor the Directors warrant the future performance of the Company or any return on an investment in the Company.

7.6 Operating Risks and Company History

The operations of the Company may be affected by various factors, including failure to locate or identify mineral deposits; failure to achieve predicted grades in exploration and mining; operational and technical difficulties encountered in mining; difficulties in commissioning and operating plant and equipment; mechanical failure or plant breakdown; unanticipated metallurgical problems which may affect extraction costs; adverse weather conditions; industrial and environmental accidents; industrial disputes; and unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment.

The Company does not have any significant operating history, although it should be noted that the Company’s directors have between them significant operational experience. No assurances can be given that the Company will achieve commercial viability through the successful exploration and/or mining of its tenement interests. Until the Company is able to realise value from its projects, it is likely to incur ongoing operating losses.

7.7 Government Regulation

Exploration and mining are subject to extensive regulation by State and Federal governments in relation to exploration, development, production, exports, taxes and royalties, labour standards, occupational health, waste disposal, protection and rehabilitation of the environment, mine reclamation, mine safety, toxic and radioactive substances, native title and other matters. Compliance with such laws and regulations will increase the costs of exploration, drilling, developing, constructing, operating and closing mines and other production facilities.

7.8 Commodity Price Volatility and Exchange Rate Risks

If the Company achieves success leading to mineral production, the revenue it will derive through the sale of commodities exposes the potential income of the Company to commodity price and exchange rate risks. Commodity prices fluctuate and are affected by many factors beyond the control of the Company. Such factors include supply and demand fluctuations for precious and base

metals, technological advancements, forward selling activities and other macroeconomic factors.

Furthermore, international prices of various commodities are denominated in United States dollars, whereas the income and expenditure of the Company are and will be taken into account in Australian currency, exposing the Company to the fluctuations and volatility of the rate of exchange between the United States dollar and the Australian dollar as determined in international markets.

7.9 Environmental Risks

The operations and proposed activities of the Company are subject to State and Federal laws and regulation concerning the environment. As with most exploration projects and mining operations, the Company’s activities are expected to have an impact on the environment, particularly if advanced exploration or mine development proceeds. It is the Company’s intention to conduct its activities to the highest standard of environmental obligation, including compliance with all environmental laws.

7.10 Title Risks and Native Title

Interests in tenements in Australia are governed by the respective State legislation and are evidenced by the granting of licences or leases. Each licence or lease is for a specific term and carries with it annual expenditure and reporting commitments, as well as other conditions requiring compliance. Consequently, the Company could lose title to or its interest in tenements if licence conditions are not met or if insufficient funds are available to meet expenditure commitments.

It is also possible that, in relation to tenements which the Company has an interest in or will in the future acquire such an interest, there may be areas over which legitimate common law native title rights of Aboriginal Australians exist. If native title rights do exist, the ability of the Company to gain access to tenements (through obtaining consent of any relevant landowner), or to progress from the exploration phase to the development and mining phases of operations may be adversely affected.

The Directors will closely monitor the potential effect of native title claims involving tenements in which the Company has or may have an interest.

7.11 Additional Requirements for Capital

The Company’s capital requirements depend on numerous factors. Depending on the Company’s ability to generate income from its operations, the Company may require further financing in addition to amounts raised under the capital raising. Any additional equity financing will dilute shareholdings, and debt financing, if available, may involve restrictions on financing and operating activities. If the Company is unable to obtain additional financing as needed, it may be required to reduce the scope of its operations and scale back its exploration programmes as the case may be. There is however no guarantee that the Company will be able to secure any additional funding or be able to secure funding on terms favourable to the Company.

7.12 Reliance on Key Management

The responsibility of overseeing the day-to-day operations and the strategic management of the Company depends substantially on its senior management and its key personnel. There can be no assurance given that there will be no detrimental impact on the Company if one or more of these employees cease their employment.

7.13 Investment Speculative

The above list of risk factors ought not to be taken as exhaustive of the risks faced by the Company or by investors in the Company. The above factors, and others not specifically referred to above, may in the future materially affect the financial performance of the Company and the value of the Options offered under this Prospectus. Therefore, the Options to be issued pursuant to this Prospectus carry no guarantee with respect to the payment of dividends, returns of capital or the market value of those securities.

Potential investors should consider that the investment in the Company is speculative and should consult their professional advisers before deciding whether to apply for securities pursuant to this Prospectus.

8. ADDITIONAL INFORMATION

8.1 Continuous Disclosure Obligations

The Company is a “disclosing entity” for the purposes of Section 713 of the Corporations Act and, as such, is subject to regular reporting and disclosure obligations. Specifically, like all listed companies, the Company is required to continuously disclose any information it has to the market which a reasonable person would expect to have a material effect on the price or the value of the Company’s securities. The Shares which will be issued pursuant to an exercise of Options are in the same class of Shares that have been quoted on the official list of the ASX during the 3 months prior to the issue of this Prospectus.

This Prospectus is a “transaction specific prospectus”. In general terms “transaction specific prospectuses” are only required to contain information in relation to the effect of the issue of securities on the Company and the rights attaching to the securities. It is not necessary to include general information in relation to all of the assets and liabilities, financial position, profits and losses or prospects of the issuing company.

This Prospectus is intended to be read in conjunction with the publicly available information in relation to the Company which has been notified to ASX and does not include all of the information that would be included in a prospectus for an initial public offering of securities in an entity that is not already listed on a stock exchange. Investors should therefore have regard to the other publicly available information in relation to the Company before making a decision whether or not to invest.

Having taken such precautions and having made such enquires as are reasonable, the Company believes that it has complied with the general and specific requirements of ASX as applicable from time to time throughout the 3 months before the issue of this Prospectus which required the Company to notify ASX of information about specified events or matters as they arise for the purpose of ASX making that information available to the stock market conducted by ASX.

Information that is already in the public domain has not been reported in this Prospectus other than that which is considered necessary to make this Prospectus complete.

The Company, as a disclosing entity under the Corporations Act states that:

(a) it is subject to regular reporting and disclosure obligations;
(b) copies of documents lodged with the ASIC in relation to the Company may be obtained from, or inspected at, the offices of the ASIC; and
(c) to the extent they are available, it will provide a copy of each of the following documents, free of charge, to any person on request between the date of issue of this Prospectus and the Closing Date:
(i) the half-year financial report lodged with the ASIC by the Company on 14 March 2008; and
(ii) any continuous disclosure notice given by the Company since it was listed on ASX.

Copies of all documents lodged with the ASIC in relation to the Company can be inspected at the registered office of the Company during normal office hours.

As at the date of this Prospectus, the Company has not lodged any annual financial report with ASIC. The Company has lodged the following announcements with ASX since lodgement of the Company’s initial public offering Prospectus on 26 September 2007.

Date

Description of Announcement

Date	Description of Announcement
29/05/2008	Acquisition of Three Rivers Project
28/05/2008	TradingHalt
28/05/2008	Issue of LoyaltyOptions
30/04/2008	QuarterlyCashflow Report
30/04/2008	QuarterlyActivities Report
11/04/2008	Change of Director’s Interest Notice
08/04/2008	ANZ: Opes Prime Disclosure
07/04/2008	ANZ: Opes Prime Disclosure
03/04/2008	Opes Prime Update
14/03/2008	Half Year Accounts
06/03/2008	Alchemysigns DrillingContract
06/03/2008	Change of Contact Details
21/02/2008	Change of Director’s Interest Notice
19/02/2008	Change of Registered Office
31/01/2008	QuarterlyCashflow Report
31/01/2008	QuarterlyActivities Report
18/01/2008	Final Director’s Interest Notice
18/01/2008	Director Resignation
17/12/2007	Investor Presentation December 2007
14/12/2007	Assessment of Potential for Large Orebodies
26/11/2007	Becominga substantial shareholder- JRL
26/11/2007	Becominga substantial shareholder
26/11/2007	Form 3X - Initial Director’s Interest
26/11/2007	Form 3X - Initial Director’s Interest
26/11/2007	Form 3X - Initial Director’s Interest
26/11/2007	Form 3X - Initial Director’s Interest
26/11/2007	Form 3X - Initial Director’s Interest
22/11/2007	Restricted Securities
22/11/2007	Up-dated balance sheet
22/11/2007	Up-dated Commitments
22/11/2007	Distribution Schedule
22/11/2007	Corporate Governance Statement

23/04/2007	ASX Circular: Commencement of Official Quotation
22/11/2007	Constitution
22/11/2007	Terms of Options
22/11/2007	Top20 shareholders
22/11/2007	Appendix 1A: ASX Listingapplication & agreement
22/11/2007	Pre-Quotation Disclosure
22/11/2007	Admission to Official List
16/10/2007	JRL: AlchemyResources – Gold IPO
26/09/2007	Disclosure Document

8.2 Directors’ Interests

Other than as set out below or elsewhere in this Prospectus, no Director nor any firm in which such a Director is a partner, has or had within 2 years before the lodgement of this Prospectus with the ASIC, any interest in:

(a) the formation or promotion of the Company;
(b) property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer of securities pursuant to this Prospectus; or
(c) the Offer of securities pursuant to this Prospectus,

and no amounts have been paid or agreed to be paid (in cash or Shares or otherwise) to any Director or to any firm in which any such Director is a partner, either to induce him to become, or to qualify him as, a Director or otherwise for services rendered by him or by the firm in connection with the formation or promotion of the Company or Offer of securities pursuant to this Prospectus.

Directors’ relevant interests in securities of the Company at the date of this Prospectus are:

Direct Interest

Name	Shares	Options	Option Entitlement
Warwick Davies	396,500	1,356,500	198,250
Michael Hannington	310,000	3,000,000	155,000
John Arbuckle	-	750,000	-
Robert Downey	-	750,000	-

Indirect Interest

Indirect Interest
Name	Shares	Options	Option Entitlement
Warwick Davies	-	-	-
Michael Hannington	-	-	-
John Arbuckle1	4,896,000	1,816,000	2,448,000
Robert Downey1	4,896,000	1,816,000	2,448,000

Note[1] : Messrs Downey and Arbuckle are directors of Canaccord Capital (Australia) Pty Ltd, the holder of shares and options.

Each of the Directors has indicated that it is their present intention to take up their full Entitlement under the Offer.

The Constitution of the Company provides that the non-executive Directors may be paid for their services as Directors a sum not exceeding such fixed sum per annum as may be determined by the Company in general meeting, to be divided among the non-executive Directors as determined by the Directors and in default of agreement, then in equal shares.

Directors, companies associated with the Directors or their associates are also reimbursed for all reasonable expenses properly incurred in the course of conducting their duties which include, but are not in any way limited to, out of pocket expenses, travelling expenses, disbursements made on behalf of the Company and other miscellaneous expenses.

The table below sets out the remuneration provided to the Directors and their associated entities during the last financial year prior to the date of this Prospectus and their current expected annual remuneration for the year ending 30 June 2008 at the date of this Prospectus inclusive of directors’ fees and consultancy fees.

Name	Year Ended 30June 2007	Current Financial Year
Warwick Davies	Nil	$40,000
Michael Hannington	Nil	$250,000
John Arbuckle	Nil	$25,000
Robert Downey	Nil	$25,000

8.3 Interests and Consents of Experts and Advisers

Other than as set out below or elsewhere in this Prospectus, no expert, underwriter, promoter or any other person named in this Prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of the Prospectus, nor any firm in which any of those persons is or was a partner, nor any company with which any of those persons is or was associated, has or had within two (2) years before the lodgement of this Prospectus with the ASIC, any interest in:

(a) the formation or promotion of the Company; or
(b) property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer of securities pursuant to this Prospectus; or
(c) the Offer of securities pursuant to this Prospectus,

and no amounts have been paid or agreed to be paid (in cash or Shares or otherwise) to any expert, underwriter, promoter or any other person named in this Prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of this Prospectus, or to any firm in which any of those persons is or was a partner, or to any company with which any of those persons is or was associated, for services rendered by that person, or by the firm or the company, in connection with the formation or promotion of the Company or the Offer of securities pursuant to this Prospectus.

8.4 Legal Proceedings

There is no litigation, arbitration or proceedings pending against or involving the Company as at the date of this Prospectus.

8.5 Estimated Expenses of Offer

In the event that the Offer is fully subscribed, the estimated expenses of the Offer are as follows:

ASIC fees Printing and other expenses Total	$ 2,010 5,000
	7,010

8.6 Market Price of Shares

The Company is a disclosing entity for the purposes of the Corporations Act and its Shares are enhanced disclosure securities quoted on ASX.

The highest and lowest market sale prices of the Company’s Shares on ASX during the three months immediately preceding the date of lodgement of this Prospectus with the ASIC and the respective dates of those sales were:

Highest: $0.245 on 28 November 2007; and Lowest: $0. 074 on 20 May 2008.

The latest available closing sale price of the Company’s Shares on ASX prior to the lodgement of this Prospectus with the ASIC was $0.12 on 28 May 2008.

9. AUTHORITY OF DIRECTORS

This Prospectus is issued by the Company and its issue has been authorised by a resolution of the Directors.

Each of the Directors of Alchemy Resources Limited has consented to the lodgement of this Prospectus with the ASIC in accordance with Section 720 of the Corporations Act.

Dated the 29[th] day of May 2008

==> picture [189 x 74] intentionally omitted <==

MR MICHAEL HANNINGTON DIRECTOR FOR AND ON BEHALF OF ALCHEMY RESOURCES LIMITED

10. DEFINITIONS

Applicant means a Shareholder or other party who applies for Options pursuant to the Offer or the Shortfall Offer.

ASIC means the Australian Securities and Investments Commission.

ASTC Settlement Rules means the settlement rules of the securities clearing house which operates CHESS.

ASX means the ASX Limited (ACN 008 624 691).

Board means the board of Directors unless the context indicates otherwise.

Business Day means a day on which trading takes place on the stock market of ASX.

Closing Date means the closing date of the Offer, being 5pm (WST) on 9 July 2008 (unless extended).

Company means Alchemy Resources Limited (ACN 124 444 122).

Constitution means the Company’s Constitution as at the date of this Prospectus.

Corporations Act means the Corporations Act 2001 (Cth).

Directors mean the directors of the Company at the date of this Prospectus.

Dollar or “ $ ” means Australian dollars.

Entitlement means the entitlement of a Shareholder who is eligible to participate in the Offer.

Entitlement and Acceptance Form means the entitlement and acceptance form either attached to or accompanying this Prospectus.

Issue means the issue of Options offered by this Prospectus.

Listing Rules or ASX Listing Rules means the Listing Rules of the ASX.

Offer means the non-renounceable entitlement offer of one (1) Option for every two (2) Shares to Shareholders on the Record Date, further details of which are included in the “Details of the Offer” section of this Prospectus.

Offer Period means the period commencing on the Opening Date and ending on the Closing Date.

Official List means the official list of ASX.

Option means an option to acquire a Share.

Prospectus means this prospectus.

Quotation and Official Quotation means official quotation on ASX.

Record Date means 5pm (WST) on 11 June 2008.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a shareholder of the Company.

Shortfall means those Options under the Offer not applied for by Shareholders under their respective Entitlement.

Shortfall Application Form means the shortfall application form attached to or accompanying this Prospectus.

WST means Western Standard Time, Perth, Western Australia.