ALCHEMY RESOURCES LIMITED — Capital/Financing Update 2010

Feb 22, 2010

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23 February 2010

Final VTEM results identify 33 copper-gold targets at Magnus

Alchemy Resources Ltd (“Alchemy” or the “Company”) (ASX: ALY) is pleased to announce that the impending exploration program at its Magnus copper-gold project in Western Australia has received a significant boost, with the Company now identifying 15 high priority drilling targets and a further 18 secondary targets (Fig. 1 & 2).

The final interpretation of the results from Alchemy’s recent VTEM survey at Magnus, 150km north of Meekatharra and immediately adjacent to Sandfire Resources NL’s spectacular DeGrussa copper-gold discovery, have further reinforced the Company’s view that Magnus is extremely prospective for similar high-grade copper-gold deposits.

An extensive drilling program focusing on the 15 high priority drilling targets will start in early March 2010, generating a steady flow of results and news over coming months.

Alchemy has also completed an extensive review of the geology at Magnus, which has concluded that there is substantial evidence to support its confidence in the area’s potential to host repeats of DeGrussa. Sandfire has recently announced that its DeGrussa Project hosts an initial JORC indicated and inferred resource of 372,000 tonnes of contained copper and 439,000 ounces of gold, with upgrades expected in the near future.

Alchemy Managing Director Michael Hannington said the geological review found Magnus met three of the key criteria considered ideal for copper mineralisation including:

• the geological setting of the Bryah Basin (Fig. 3), which hosts the Magnus and DeGrussa Projects, is comparable to rift-related settings that host a number of world class copper systems, such as Besshi in Japan (0.7Mt contained copper) and the giant Windy Craggy deposit in Canada (4.2Mt contained copper);

• the greater than 5km thick sequence of mafic volcanic and sedimentary rocks in the Bryah Basin are similar to sequences that host major mafic type copper rich deposits, such as the Windy Craggy deposit; and

• the Bryah Basin hosts extensional faults which provide the conduits for the transport of copper rich fluids that are deposited as a result of significant pressure changes that accompanied the escape of hot fluids onto the Proterozoic oceanic floor (Fig. 4).

“This review has found that the geological conditions at Magnus are outstanding,” Mr Hannington said. “They contain many of the key attributes needed to host a substantial copper deposit and we are excited at the prospect of drilling the first 15 highly prospective targets on our tenements.”

ENDS

T: +61 8 9481 4400 E: admin@alchemyresources.com.au F: +61 8 9481 4404 W: www.alchemyresources.com.au

18 Emerald Terrace GPO Box 2815 West Perth WA 6005 Perth WA 6001

For further information contact:

Michael Hannington Managing Director T: (61 8) 9481 4400

Media: Paul Armstrong Read Corporate T: (61 8) 9388 1474

About Alchemy Resources Limited

Alchemy is focused on two emerging resource projects within its Three Rivers tenements in the Gascoyne Goldfield region of Western Australia: the Hermes Gold Project and the Magnus Copper-Gold Project . Aggressive exploration and evaluation programs are underway at both projects in 2010.

At Hermes , Alchemy has discovered three new gold zones with the potential to expand its current JORC compliant indicated resource of 1.7Mt @ 2.4g/t gold (131,000 ounces of gold). In parallel with follow-up drilling to test these zones, the Company is evaluating strategic development options for this asset including both toll-treatment and standalone development.

At Magnus , Alchemy is pursuing exploration targeting the potential for copper-gold orebodies similar to Sandfire Resources NL’s DeGrussa, Conductor 1 and Conductor 4 orebodies. Alchemy’s tenements adjoin Sandfire’s and cover approximately 178km[2 ] of the highly prospective Narracoota Formation that hosts the DeGrussa and Conductor 1 & 4 orebodies. Alchemy has delineated a pipeline of exploration targets within its tenements and is adopting a systematic and focused approach to exploration.

The information in this report that relates to Exploration Results is based on information compiled by Dr Kevin Cassidy, who is a Fellow of the Australian Institute of Geoscientists, and is an employee of Alchemy Resources Limited. Dr Cassidy has sufficient experience that is relevant to the style of mineralisation, type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the ‘Australasian Code for Reporting of Exploration, Results, Mineral Resource and Ore Reserves’. Dr Cassidy consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

The information in this report that relates to Mineral Resources at the Hermes Gold Project is based on information compiled by Mr Shaun Hackett, who is a Member of the Australasian Institute of Mining and Metallurgy and a full-time employee of Snowden Mining Industry Consultants Pty Ltd. Mr Hackett has sufficient experience that is relevant to the style of mineralisation, type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the ‘Australasian Code for Reporting of Exploration, Results, Mineral Resource and Ore Reserves’. Mr Hackett consents to the inclusion in this report of the matters based on his information in the form and context that the information appears.

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Figure 1. – Location of Magnus Copper-Gold Project at Three Rivers tenements and location of priority 1 & 2 targets

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Figure 2. – VTEM Conductors over Magnus Copper-Gold Project – VTEM Channel 30

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Figure 3. – Development of Bryah Basin in the Proterozoic (2 billion years ago)

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Figure 4. – Emplacement of Basalt in a Rifting Basin

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Figure 5. – Three Rivers Project Location Map

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