CHALICE MINING LIMITED — Capital/Financing Update 2020

Apr 6, 2020

7 April 2020

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First diamond drill hole at Karri hits primary gold zone

A strong result from the first-ever test at depth below the >4km long Karri gold trend at the Pyramid Hill Gold Project in Victoria

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Highlights

• The first diamond drill hole at the Karri Prospect (PHD001), the first-ever test at depth into a ‘ blind target ’, has intersected:

• 2.55m @ 2.29g/t Au within 11.45m @ 1.02g/t Au from 284m.

• The gold zone is associated with a zone of stockwork quartz veining in Castlemaine Group sediments, a similar association to other major gold systems in the region.

• The gold zone is associated with a tight upright fold hinge – a characteristic feature of the large gold systems in the Bendigo Zone including Fosterville (>9Moz Au) and Bendigo (>22Moz Au) .

• Multiple anomalous gold intervals also intersected in PHD001 suggest the presence of a significant gold system below the >4km long continuous gold trend defined by shallow air-core (AC) drilling.

• Significant new results also received from 78 new AC drill holes at Karri , including:

• 4m @ 3.02g/t Au within 8m @ 1.64g/t Au from 152m to end-of-hole (EOH) ;

• 4m @ 1.25g/t Au within 12m @ 0.52g/t Au from 76m; and,

• 1m @ 2.51g/t Au within 32m @ 0.19g/t Au from 86m.

• The >4km long Karri gold trend defined by AC drilling remains continuous , providing an exceptional scale, high-quality target for further deep drilling.

• Assays are pending for a further 27 AC holes and two diamond holes drilled at Karri.

• The first diamond drill hole at the Ironbark North Target (PHD002) intersected encouraging strong alteration and several intervals of anomalous gold.

• The geological diamond drill program at the Project continues with two diamond rigs currently drilling on 500m-1km spaced drill lines at Karri.

• Drilling also continues at the Julimar Nickel-Copper-PGE Project, WA, where a diamond rig and an RC rig are currently drilling .

• Chalice is well positioned in the exciting Victorian Goldfields region with a 100%-owned, >5,000km[2] land position and remains fully funded to continue its systematic exploration activities, with an estimated working capital and investments balance of ~A$25 million (~A$0.09 per share) .

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Chalice Gold Mines Limited (“Chalice” or “the Company”, ASX: CHN | OTCQB: CGMLF) is pleased to report initial results from its first diamond drill program at its 100%-owned Pyramid Hill Gold Project in the Bendigo Region of Victoria.

The first diamond drill hole at the Karri Prospect successfully intersected an ~11m wide zone of primary gold mineralisation below the 4km long gold trend defined by shallow AC drilling, a significant result.

Operational update

The Company is continuing its systematic exploration drilling program at the Pyramid Hill Gold Project with two diamond rigs currently on site. The COVID-19 pandemic has had minimal impact on the operational schedule to date, however appropriate protocols are in place to reduce the associated risks to employees and contractors.

New assay results have been received for the first diamond drill holes at both Karri and Ironbark North, as well as 78 AC holes at Karri, following on from the results released previously (refer ASX Announcements on 12 December 2019, 13 January 2020, 3 February 2020 and 4 March 2020). Assays are currently pending for a further 27 AC drill holes and an additional two diamond drill holes completed at Karri.

The Company’s maiden 15 line-km 2D seismic survey was completed over the northern part of the Muckleford Area, including over the Karri Prospect, in mid-February and results, including a detailed structural interpretation to a depth of ~2km, are expected in mid-April.

Diamond drill results – Karri Prospect

The maiden diamond drill program at the Karri Prospect (~7 holes for ~2,300m) is designed to provide a first-pass geological assessment of the Castlemaine Group sediments beneath the strongly anomalous gold trends identified from shallow AC drilling and which extend over more than 4km of strike length.

The Castlemaine Group is the target basement sequence which hosts >60Moz of high-grade historical gold production from the outcropping areas of the Bendigo Zone to the south of the Project.

Detailed structural / geological logging is being used to develop an early stage structural and stratigraphic model for the prospect which will assist with future diamond drill hole targeting.

PHD001 was collared at the northern end of the main gold trend to test beneath a sub-horizontal secondary dispersion zone of anomalous gold and pathfinder metals (As, Sb, Te) within two 50m-spaced vertical AC drill holes ( Figure 1 ). The two AC drill holes intersected:

• 8m @ 0.46g/t Au to EOH within 40m @ 0.13g/t Au from 80m, and;

• 17m @ 0.12g/t Au from 118m to EOH.

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Chalice Gold Mines Limited ABN 47 116 648 956 ASX : CHN | OTCQB: CGMLF

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Figure 1. Karri Prospect Plan View – Drilling results over gravity geophysics.

PHD001 intersected a tightly folded sequence of interbedded sandstone and shales of the Castlemaine Group sediments including a pronounced stockwork zone of mineralised quartz veins (5-20cm wide) which assayed 2.55m @ 2.29g/t Au within 11.45m @ 1.0g/t Au from 284m downhole ( Figures 2 and 3 ).

Several other intervals of anomalous gold were intersected in PHD001 and are associated with narrow quartz veins, showing that the gold system extends to depth, below the AC drilling.

Structural measurements from oriented drill core indicate that the gold zone is developed within a localised fold hinge which itself is part of a larger anticline-syncline fold pair.

This structural setting is analogous to other gold deposits in the region which are associated with hinge zones of tight upright folds. These initial results from Karri continue to support the presence of a prospective gold system and represent a significant technical milestone for the prospect.

The zone of gold mineralisation is also highly anomalous in arsenic (11.45m @ 1,877ppm As) with a peak of 4,180ppm As. Arsenic is considered an important pathfinder metal for gold mineralisation in the region.

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Figure 2. Karri Prospect Cross Section 5,986,400mN (PHD001).

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Figure 3. Quartz veining within PHD001 (285.1m to 288.5m shown).

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Chalice Gold Mines Limited

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ABN 47 116 648 956 ASX : CHN | OTCQB: CGMLF

AC drill results – Karri Prospect

The infill AC drill program aimed to test the continuity and extent of previously intersected gold mineralisation at the Karri Prospect on a 250-500m x 50m infill and step-out grid. All AC holes were drilled vertically to AC blade refusal, which typically occurs at the base of weathering in the Castlemaine Group sediments.

Several new zones of gold mineralisation were identified ( Figure 4 ) and importantly, all infill drilling continues to demonstrate the robustness of the multi-kilometre scale gold trends, with all defined gold trends showing continuity on 250m spaced infill drill lines.

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Figure 4. Karri Prospect Plan View – AC drilling results over gravity geophysics.

As seen in previously identified gold zones, the new AC intercepts are associated with zones of quartz veining with minor amounts of sulphides including pyrite ± arsenopyrite within the Castlemaine Group basement, typical of Bendigo-style deposits.

Diamond drill results – Ironbark North Target

The Company also received assays from its first diamond drill hole at the Ironbark North target (PHD002), which was designed to test the western margin of the prospective diorite intrusive, beneath an AC drill intercept of 20m @ 0.85g/t Au from 102m to EOH incl. 8m @ 2.0g/t Au.

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Encouraging indications of mineralisation were intersected throughout the hole, including 2.6m @ 0.76g/t Au from 155.3m, where the gold is associated with a zone of strong pervasive sericite alteration. This style of alteration is a common feature of the high-grade Woods Point gold deposits of the Melbourne Zone, often occurring as alteration selvages to high-grade laminated quartz veining.

The contact between diorite and surrounding Castlemaine Group sediments was not intersected and therefore further diamond drilling is planned. The eastern diorite contact at Ironbark North is planned to be tested in the current diamond drill program.

Forward plan

The maiden geological diamond drill program will continue at the Pyramid Hill Gold Project utilising two rigs. Drilling at Karri is anticipated to continue until late April when access is restricted temporarily by farming activities. Drilling is expected to then resume at the Ironbark Targets, as this area has fewer access restrictions.

Chalice will continue to monitor the current advice from the Government and health authorities with regards to restrictions imposed due to the COVID-19 pandemic, and to ensure the ongoing health and well-being of its employees and contractors.

Discussion

Chalice’s Managing Director, Alex Dorsch, said: “This is the first ever test into fresh rock within our Pyramid Hill Project area, so to have intersected a primary gold zone straight away is an exciting development – and one that provides further indications of the potential to discover a sizeable gold system that the Bendigo region is renowned for.

“Given that this was essentially a geological hole into a ‘blind target’, we are very encouraged that it has delivered both a significant zone of primary gold mineralisation and valuable information about the geological and structural setting at depth.

“The first hole has successfully demonstrated that the key elements of the mineralisation styles at Bendigo and Fosterville, namely gold bearing quartz veins associated with tightly folded sediments, are present at Karri and the potential remains for a significant gold discovery.

“Drilling continues at the Pyramid Hill Project with two diamond rigs, in tandem with the rapid escalation of exploration activity at our new nickel-copper-PGE discovery at our Julimar Project in WA. This gives our shareholders exposure to two exciting greenfield projects in Australia with genuine company-making potential.”

Authorised for release on behalf of the Company by:

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Alex Dorsch Managing Director

For further information, please visit www.chalicegold.com to view our latest corporate presentation, or contact:

Corporate Enquiries Media Enquiries Alex Dorsch Nicholas Read Managing Director Principal and Managing Director

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Chalice Gold Mines Limited ABN 47 116 648 956 ASX : CHN | OTCQB: CGMLF

Chalice Gold Mines Limited Read Corporate Investor Relations +61 8 9322 3960 +61 8 9388 1474 info@chalicegold.com info@readcorporate.com.au

Follow our communications: LinkedIn: https://au.linkedin.com/company/chalice-gold-mines Twitter: https://twitter.com/chalicegold Facebook: https://www.facebook.com/Chalice-Gold-Mines-323740744933099/

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About the Pyramid Hill Gold Project, Victoria, Australia

The 100%-owned Pyramid Hill Gold Project was staked in late 2017 and now covers an area of >5,000km[2] in the Bendigo region of Victoria. The Project comprises three key districts within the Murray Basin covered North Bendigo and North Stawell Zones: Muckleford, Mt William and Percydale ( Figure 5 ).

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Figure 5. Pyramid Hill Gold Project tenure, regional land holders, gold deposits and occurrences.

The central Muckleford Area extends to the north-west of the high-grade historic >22Moz Bendigo Goldfield. The Mt William Area extends to the north-east of one of the world’s highest-grade producing gold mines, the ~9Moz Fosterville Gold Mine owned by Kirkland Lake Gold (NYSE / TSX: KL | ASX: KLA). The Percydale Area is located north-west of the historical St Arnaud Goldfield within the Stawell Zone.

The ‘Gold Undercover’ initiative by the Victorian Government in 2006-2009 estimated a potential ~32Moz (P50 mid-case) of undiscovered gold beneath Murray Basin cover in the Bendigo Zone. However, the vast majority of the covered area remains sparsely explored. Given there is highly variable, shallow cover over a large portion of the Project, the Company believes that there is excellent potential for the discovery of new commercially viable gold deposits.

Chalice is targeting tier-1 scale (>US$1bn NPV), high-grade gold discoveries under cover and is currently conducting a systematic, regional-scale greenfield exploration program. The Company is utilising all

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available targeting tools at its disposal, including the substantial pre-existing regional geophysics database (including crustal scale 2D seismic), regional-scale soil sampling and ground geophysics.

Low-cost reconnaissance air-core (AC) drilling to the top of the target basement on wide-spaced lines is currently being used effectively to narrow the target search space over the very large Project area. Chalice’s phased drilling program to date includes:

• A ~350 hole, ~39,000m Phase 1 reconnaissance AC drill program in the Muckleford and Mt William Areas across several greenfield target areas – commenced in October 2018 and completed in June 2019;

• A ~250 hole, ~25,000m Phase 2 reconnaissance AC drill program at the newly identified Karri, Ironbark and Beech Targets in the Muckleford Area – commenced in October 2019 and completed in early February 2020;

• A ~140 hole, ~14,000m step-out and infill AC drill program at the Karri and Ironbark Targets – commenced in early February 2020 and completed in mid-March 2020; and,

• A maiden geological diamond drill-hole program at the Karri and Ironbark Targets – commenced in mid-January 2020 and ongoing.

Competent Persons and Qualifying Persons Statement

The information in this announcement that relates to Exploration Results in relation to the Pyramid Hill Gold Project is based on information compiled by Dr. Kevin Frost BSc (Hons), PhD, a Competent Person, who is a Member of the Australian Institute of Geoscientists. Dr. Frost is a full-time employee of the company and has sufficient experience that is relevant to the activity being undertaken to qualify as a Competent Person as defined in the 2012 edition of the Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves, and is a Qualified Person under National Instrument 43-101 – ‘Standards of Disclosure for Mineral Projects’. The Qualified Person has verified the data disclosed in this release, including sampling, analytical and test data underlying the information contained in this release. Dr. Frost consents to the inclusion in the announcement of the matters based on his information in the form and context in which it appears.

The Information in this announcement that relates to previous exploration results for the Pyramid Hill Project is extracted from the following ASX announcements:

• “Discovery of new >2km gold trend in air-core drilling at Karri Target indicates potential for a significant gold system”, 12 December 2019

• “Several new gold zones discovered in first drill holes at Ironbark North Target”, 19 December 2019

• “Karri gold trend expanded to over 3km of strike extent”, 13 January 2020

• “Infill AC drilling at Karri returns best intercept to date of 4m at ~4g/t gold”, 3 February 2020

• “New high-grade gold zones at the large-scale Karri Target”, 4 March 2020

The above announcements are available to view on the Company’s website at chalicegold.com. The Company confirms that it is not aware of any new information or data that materially affects the information included in the relevant original market announcements. The Company confirms that the form and context in which the Competent Person and Qualified Person’s findings are presented have not been materially modified from the relevant original market announcements.

Forward Looking Statements

This report may contain forward-looking information within the meaning of Canadian securities legislation and forwardlooking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, forward-looking statements). These forward-looking statements are made as of the date of this report and Chalice Gold Mines Limited (the Company) does not intend, and does not assume any obligation, to update these forwardlooking statements.

Forward-looking statements relate to future events or future performance and reflect Company management’s expectations or beliefs regarding future events and include, but are not limited to, the Company’s strategy, the price

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of O3 Mining securities and Ramelius Resources securities, receipt of tax credits and the value of future tax credits, the estimation of mineral reserve and mineral resources, the realisation of mineral resource estimates, the likelihood of exploration success at the Company’s projects, the prospectivity of the Company’s exploration projects, the timing of future exploration activities on the Company’s exploration projects, planned expenditures and budgets and the execution thereof, the timing and availability of drill results, potential sites for additional drilling, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage.

In certain cases, forward-looking statements can be identified by the use of words such as “plans”, “planning” “expects” or “does not expect”, “is expected”, “will”, “may”, “would”, “potential”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, “believes”, “occur”, “impending”, “likely”, “suggests” or “be achieved” or variations of such words and phrases or statements that certain actions, events or results may, could, would, might or will be taken, occur or be achieved or the negative of these terms or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

Such factors may include, among others, risks related to actual results of current or planned exploration activities; changes in project parameters as plans continue to be refined; changes in exploration programs based upon the results of exploration; future prices of mineral resources; possible variations in mineral resources or ore reserves, grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; movements in the share price of O3 Mining and Ramelius Resources securities and future proceeds and timing of potential sale of O3 Mining and Ramelius Resources securities, as well as those factors detailed from time to time in the Company’s interim and annual financial statements, all of which are filed and available for review on SEDAR at sedar.com, ASX at asx.com.au and OTC Markets at otcmarkets.com.

Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

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Appendix 1: Significant new diamond drill intercepts (>0.5g/t Au) – Fire assay – Karri Prospect and Ironbark North Target, Pyramid Hill Gold Project

Hole ID	From(m)	To(m)	Interval(m)	Gold(g/t)
PHD001	284	295.45	11.45	**1.02 **
incl.	285.65	288.65	2.55	2.29
PHD001	346.81	349.16	2.35	0.63
PHD002	151.4	157.9	6.5	0.37
incl.	155.3	157.9	2.6	0.76

Appendix 2: Significant new AC drill intercepts Au (>0.1g/t Au) – 4m composite Aqua Regia assay – Karri Prospect, Pyramid Hill Gold Project

Hole ID	From(m)	To(m)	Interval(m)	Gold(g/t)
PA632	100	104	4	0.24
PA636	72	88	16	0.43
incl.	80	84	4	1.40
PA637	76	104	28	0.17
PA637	124	127(EOH)	3	0.11
PA641	80	84	4	0.15
PA652	70	74	4	0.14
PA655	86	118	32	0.18
incl.	94	98	4	0.89
PA655	138	141(EOH)	3	0.12
PA658	68	76	8	0.10
PA663	116	126(EOH)	10	0.21
PA664	76	80	4	0.10
PA667	80	84	4	0.14
PA667	92	96	4	0.12
PA667	120	124	4	0.10
PA669	112	116	4	0.11
PA669	128	132	4	0.29
PA677	84	104	20	0.10
PA678	152	160(EOH)	8	1.64
incl.	152	156	4	3.02
PA681	64	72	8	0.29
PA682	80	84	4	0.16
PA688	76	80	4	0.13
PA689	40	56	16	0.13
incl.	40	44	4	0.38
PA690	80	84	4	0.14
PA692	60	72	12	0.11
PA692	80	92	12	0.10
PA693	60	64	4	0.10
PA694	44	52	8	0.10
PA700	80	84	4	0.16
PA701	44	52	8	0.15
PA705	66	74	8	0.11
PA705	86	90	4	0.11

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	PA710	92	96	4	0.19
	PA711	72	100	28	0.24
	incl.	76	88	12	0.52
	incl.	80	84	4	1.25

Appendix 3: Significant AC drill intercept re-assay Au (>0.1g/t Au) – 1m re-split Fire Assay – Karri Prospect, Pyramid Hill Gold Project

Hole ID	From(m)	To(m)	Interval(m)	Gold(g/t)
PA575	108	109	1	0.13
PA655	86	118	32	0.19
incl.	94	99	5	0.79
incl.	94	95	1	2.51
PA655	138	141	3	0.18
PA667	91	97	6	0.11
PA667	119	120	1	0.12
PA667	122	123	1	0.13

Appendix 4: JORC Table 1 – Pyramid Hill Gold Project

Section 1 Sampling Techniques and Data

Criteria	JORC Code explanation	Commentary
Sampling techniques	• Nature and quality of sampling (eg. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling. • Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. • Aspects of the determination of mineralisation that are Material to the Public Report. • In cases where ‘industry standard’ work has been done this would be relatively simple (eg. ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (eg. submarine nodules) may warrant disclosure of detailed information.	• Aircore (AC) drilling samples were collected via 2-4m composite samples from 1m bulk samples using a PVC spear with each combined composite sample weighing approximately 3kg. 1m samples were taken where applicable at EOH. Additional 1m re-splits were collected from 1m bulk samples using a PVC spear. Diamond drill core samples were taken over selected intervals ranging from 0.2m – 1.3m, cut and sampled via half core. • All composites were pulverised to nominal 85% passing 75 microns before being analysed. • Qualitative care was taken to ensure representative sample weights were consistent when sampling on a metre by metre basis. Care was taken when sampling the diamond core to sample the same half side of the core as standard practice.
Drilling techniques	• Drill type (eg. core, reverse circulation, open- hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg. core diameter, triple or standard tube, depth of diamond _tails, face-sampling bitor other type, whether _	• Drilling was undertaken by either Air-core or diamond techniques. Air-core (AC) drilling used predominately blade and/or face sampling hammer with a diameter of 102-104mm.Diamond drillcoreisHQ size

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	Criteria	JORC Code explanation	Commentary
		core is oriented and if so, by what method, etc).	(63.5mm diameter).
	Drill sample recovery	• Method of recording and assessing core and chip sample recoveries and results assessed. • Measures taken to maximise sample recovery and ensure representative nature of the samples. • Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gainof fine/coarse material.	• Individual recoveries of both composite and core samples were recorded on a qualitative basis. Generally sample weights are comparable and any bias is considered negligible. • No relationships have been noticed between sample grade and recoveries.
	Logging	• Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies. • Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography. • The total length and percentage of the relevant intersections logged.	• All drill holes were logged geologically including but not limited to; weathering, regolith, lithology, structure, texture, alteration and mineralisation. Logging was at an appropriate quantitative standard to support future geological, engineering and metallurgical studies. • Logging is considered quantitative in nature. • All holeswere geologicallyloggedin full.
	Sub-sampling techniques and sample preparation	• If core, whether cut or sawn and whether quarter, half or all core taken. • If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry. • For all sample types, the nature, quality and appropriateness of the sample preparation technique. • Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples. • Measures taken to ensure that the sampling is representative of the in-situ material collected, including for instance results for field duplicate/second-half sampling. • Whether sample sizes are appropriate to the grain size of the material being sampled.	• For AC drilling, 1 metre samples were collected in bulk form from the rig cyclone. 2-4m composite samples and 1m re-splits of the 1m bulk samples were collected using a spear method. The majority of the samples were dry in nature. For DD drilling, the core was cut in half and selectively sampled at 0.2-1.3m intervals. • For AC drilling, field duplicate samples were collected every 20thsample to check for assay repeatability. Results of duplicate samples were considered acceptable and within precision and accuracy limits for the style of mineralisation. Duplicate samples were not taken for the diamond samples. • Sample sizes are considered appropriate for the style mineralisation sought and the initial reconnaissance nature of the drilling programme.
	Quality of assay data and laboratory tests	• The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total. • For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc. • Nature of quality control procedures adopted (eg. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (ie. lack of bias) and precision have been established.	• All samples were sent to ALS Adelaide for sample preparation then on-sent to ALS Perth for chemical analysis. • For all composite aircore samples, 40 elements (including gold) were analysed using up to a 25g aqua regia method with an ICPAES and ICPMS finish depending on the elements (ALS method code – TL43- MEPKG). Aqua Regia techniques are not considered total in nature. Should refractory mineralisation be encountered (not expected) this can affect the nature of final results. 1m re-splits were analysed using 50g fire assay with ICP-AES finish. Diamond sampleswere assayedforboth

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	Criteria	JORC Code explanation	Commentary
			50g fire assay (Au) and a 48 element 4 acid suite (ALS method Codes – Au-ICP22 and ME-MS61). These techniques are considered total in nature. • Chalice has its own internal QAQC procedure involving the use of certified reference materials. For AC drilling, Standards – 4 per 100 samples, blanks – 1 per 100 samples and duplicates 4 per 100 samples which accounts for ~9% of the total submitted samples. For analysis of diamond drill core, standards and blanks are inserted by the field Geologist at random intervals which accounts for between6-9% of totalsubmitted samples.
	Verification of sampling and assaying	• The verification of significant intersections by either independent or alternative company personnel. • The use of twinned holes. • Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols. • Discuss any adjustment to assay data.	• Significant intersections are checked by the Project Senior Geologist and then by the General Manager of Exploration. Significant intersections are cross-checked with the geology logged and drill chips collected after final assays are received. • No twin holes have been drilled for comparative purposes. The Target is still considered to be in an early exploration stage. • Primary data was digitally collected and entered via a field Toughbook computer using in house logging codes. The data is sent to Perth where the data is validated and entered into the master database. • No adjustments have been made to the assay datareceived.
	Location of data points	• Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation. • Specification of the grid system used. • Quality and adequacy of topographic control.	• Hole collar locations have been picked up by Chalice employees using a handheld GPS with a +/- 5m error. • The grid system used for the location of all drill holes is MGA_GDA94 (Zone 54). A grid zone boundary transects the larger project area. • RL data is considered unreliable although topography around the drill area is flat and hence should not have any significant effect on the interpretation of data. RL’s have been assigned from 1 sec (30m) satellite data.
	Data spacing and distribution	• Data spacing for reporting of Exploration Results. • Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied. • Whether sample compositing has been applied.	• Nominal drill hole spacing is generally 50- 500m between AC holes. Spacing between diamond holes in >0.5km • The current spacing is not considered sufficient to assume any geological or grade continuity of the results intersected. • No sample compositing has been applied.
	Orientation of data in	• Whether the orientation of sampling achieves unbiased sampling of possible	• Sampling has been routinely completed beneath transported cover with no

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	Criteria	JORC Code explanation		Commentary
	relation to geological structure	structures and the extent to which this is known, considering the deposit type. • If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.		selective bias to any particular primary geological domain. • Intersected anomalism to date in AC drilling is generally flat in nature however exact controls on gold anomalism remain unknown. Structural measurements taken in the diamond drilling suggests a tightly folded succession of rocks. As such its relationship to optimal drill direction (perpendicular to anomalism) remains unclear.
	Sample security	• The measures taken to ensure sample security.		• Chain of custody is managed by Chalice. Samples are stored on site before being transported by third parties to the laboratoriesin Adelaide andPerth.
	Audits or reviews	• The results of any audits or reviews of sampling techniques and data.		• No review has been carried out to date.
	Section 2 Reporting of Exploration Results
	Criteria		JORC Code explanation	Commentary
	Mineral tenement and land tenure status		• Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings. • The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.	• Drilling was carried out within EL6737. All licences are wholly owned by CGM (WA) Pty Ltd, a wholly owned subsidiary of Chalice Gold Mines Limited with no known encumbrances.
	Exploration done by other parties		• Acknowledgment and appraisal of exploration by other parties.	• There has been little effective exploration completed by other parties in the immediate vicinity of the targets identified by Chalice to date. • Chalice has compiled historical records dating back to the early 1980’s which indicate only sporadic reconnaissance drilling has been completed by various parties over the project area. All known effective drill holes that reached the basement and were assayed for gold have been compiled. • Homestake Mining completed initial surface sampling which has been evaluated and used by Chalice for some targeting purposes.
	Geology		• Deposit type, geological setting and style of mineralisation.	• The mineralisation being explored for is orogenic style similar to that seen within the Bendigo and Fosterville gold deposits of the Bendigo Zone. Gold mineralisation in these deposits is typically hosted by quartz veins within Ordovician age Castlemaine Group sediments.
	Drill hole Information		• A summary of all information material to the understanding of the exploration results	• Refer Appendices 1 - 4.

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		including a tabulation of the following information for all Material drill holes: o easting and northing of the drill hole collar o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar o dip and azimuth of the hole o down hole length and interception depth o hole length. • If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.
	Data aggregation methods	• In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg. cutting of high grades) and cut-off grades are usually Material and should be stated. • Where aggregate intercepts incorporate short lengths of high-grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail. • The assumptions used for any reporting of metal equivalent values should be clearly stated.	• A length-weighted averaging technique has been applied where necessary to produce all displayed and tabulated drill intersections. In Appendix 1 and in the figures, results are calculated using either a minimum 0.025g/t, 0.1g/t or 1g/t Au lower cut-off grade and a maximum of 4m internal dilution. • Not Applicable. • Not Applicable.
	Relationship between mineralisation widths and intercept lengths	• These relationships are particularly important in the reporting of Exploration Results. • If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. • If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg. ‘down hole length, true width not known’).	• The relationship between gold anomalism and true width remains unknown. The AC anomalism reported is currently interpreted to be a product of secondary dispersion and/or directly related to gold bearing quartz veining in the primary Castlemaine Group basement. True widths of the diamond intervals reported remain unknown due to the tightly folded sequence of geological units and the limited amount of deep drilling completed on section i.e. 1 hole persection
	Diagrams	• Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.	• Refer to figures in the body of text.
	Balanced reporting	• Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.	• Only significant results above 0.1g/t Au have been tabulated. The results are considered representative with no intended bias.

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	Other substantive exploration data	• Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.	• Not Applicable.
	Further work	• The nature and scale of planned further work (eg. tests for lateral extensions or depth extensions or large-scale step-out drilling). • Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.	• Further reconnaissance diamond drilling is being undertaken in a first pass test of the primary bedrock beneath the supergene AC anomalism to improve the understanding of the geological controls to anomalism. • Target Zones (anomalous gold trends) as defined on the plan figures highlight the areas of most interest for further follow-up exploration.

Appendix 5: New AC and diamond drill hole details – Karri and Ironbark North, Pyramid Hill Gold Project

Hole ID	Northing MGA z54(mN)	Easting MGA z54(mE)	RL(m)	Azimuth UTM(°)	Dip (°)	Depth(m)
PHD001	5986408	767250	103	88.7	-58.0	392.7
PHD002	5964140	764035	118	88.1	-58.6	300.3
PA632	5986700	767362	102	360	-90	104
PA633	5986694	767409	102	360	-90	132
PA634	5986695	767460	102	360	-90	120
PA635	5986698	767508	102	360	-90	133
PA636	5986164	767311	103	360	-90	116
PA637	5986167	767367	103	360	-90	127
PA638	5986167	767415	102	360	-90	66
PA639	5986165	767423	102	360	-90	114
PA640	5986164	767465	102	360	-90	116
PA641	5986165	767563	102	360	-90	120
PA642	5986164	767614	102	360	-90	130
PA643	5986163	767663	102	360	-90	108
PA644	5985883	767664	102	360	-90	112
PA645	5985885	767713	102	360	-90	118
PA646	5985885	767765	102	360	-90	125
PA647	5985583	767576	102	360	-90	126
PA648	5985586	767625	102	360	-90	72
PA649	5985586	767675	102	360	-90	103
PA650	5985586	767725	102	360	-90	102
PA651	5985596	767616	102	360	-90	120
PA652	5985585	767275	102	360	-90	110
PA653	5985585	767325	102	360	-90	113
PA654	5985586	767376	102	360	-90	115
PA655	5985585	767425	102	360	-90	141
PA656	5985320	767604	103	360	-90	113
PA657	5985320	767700	103	360	-90	125
PA658	5985585	767475	102	360	-90	122

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	Hole ID	Northing MGA z54(mN)	Easting MGA z54(mE)	RL(m)	Azimuth UTM(°)	Dip (°)	Depth(m)
	PA659	5985019	767130	103	360	-90	91
	PA660	5985020	767179	103	360	-90	90
	PA661	5985019	767227	103	360	-90	102
	PA662	5985020	767277	103	360	-90	132
	PA663	5985023	767328	103	360	-90	126
	PA666	5985019	767483	103	360	-90	131
	PA667	5985022	767527	103	360	-90	126
	PA668	5985022	767580	103	360	-90	120
	PA669	5985021	767626	103	360	-90	150
	PA670	5985021	767679	103	360	-90	81
	PA671	5984732	767076	103	360	-90	137
	PA672	5984730	767122	103	360	-90	120
	PA673	5984729	767175	103	360	-90	113
	PA674	5984729	767225	103	360	-90	120
	PA675	5984604	767303	104	360	-90	132
	PA676	5984634	767392	104	360	-90	132
	PA677	5984629	767450	104	360	-90	123
	PA678	5984632	767498	104	360	-90	160
	PA679	5984574	767573	104	360	-90	141
	PA680	5984570	767624	104	360	-90	155
	PA681	5984119	767459	104	360	-90	138
	PA682	5984119	767601	104	360	-90	115
	PA683	5984119	767647	104	360	-90	122
	PA684	5985584	766932	103	360	-90	122
	PA685	5985584	766887	103	360	-90	119
	PA686	5985582	766842	103	360	-90	106
	PA687	5986166	766967	103	360	-90	113
	PA688	5986166	766920	102	360	-90	104
	PA689	5986168	766869	102	360	-90	100
	PA690	5986166	766818	102	360	-90	102
	PA691	5986164	766769	102	360	-90	108
	PA692	5986165	766719	102	360	-90	105
	PA693	5985879	766483	102	360	-90	105
	PA694	5985879	766527	102	360	-90	99
	PA695	5985881	766577	102	360	-90	84
	PA696	5985776	766648	102	360	-90	74
	PA697	5985779	766692	102	360	-90	84
	PA698	5985587	766678	103	360	-90	93
	PA699	5985584	766623	103	360	-90	100
	PA700	5985585	766685	103	360	-90	114
	PA701	5985880	766229	102	360	-90	83
	PA702	5985880	766282	102	360	-90	77
	PA703	5985879	766331	102	360	-90	80
	PA704	5985877	766379	102	360	-90	86
	PA705	5985880	766431	102	360	-90	94
	PA706	5986693	767061	101	360	-90	132
	PA707	5986697	767012	102	360	-90	133
	PA708	5986700	766961	102	360	-90	126
	PA709	5986696	766913	102	360	-90	111

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	Hole ID	Northing MGA z54(mN)	Easting MGA z54(mE)	RL(m)	Azimuth UTM(°)	Dip (°)	Depth(m)
	PA710	5983663	767346	104	360	-90	102
	PA711	5983662	767398	104	360	-90	120

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