PATERSON RESOURCES LTD — Capital/Financing Update 2014

Dec 2, 2014

ASX ANNOUNCEMENT 3rd December 2014 FOR IMMEDIATE RELEASE

METALLURGIAL DRILLING – ABUNDANT CHALCOPYRITE IN CORE

Elysium Resources Limited ("Elysium" or "Company") (ASX:EYM) is pleased to announce the commencement of drilling to source metallurgical sample from the proposed Lloyds open pit at its Burraga Copper Project ("Project") in NSW.

Highlights

• Three diamond drill-hole program commences to source metallurgical sample.
• Water monitoring bores completed; groundwater monitoring has commenced.
• Final development and exploratory RC drill planning completed.

As announced on November 10th and 24th, confirmatory reverse circulation (RC) drilling was undertaken to progress the resource development at Lloyds and locate areas suitable to source the initial 200kg of bulk sample required for metallurgical test-work. Following the receipt of the RC results, the 3 diamond holes planned to source the required metallurgical sample will be drilled adjacent to RC holes EYMRC-003, EYMRC-005 and EYMRC-010. Figures 1 and 3 show some of the initial core from drilling adjacent to EYMRC-005; the chalcopyrite interval shown below is adjacent to interval 66-67m in EYMRC-005 as announced on November 10th. Chalcopyrite (CuFeS2) is the dominant copper bearing mineral at Lloyds. It is anticipated that the drilling be completed over the next two weeks and the bulk sample be shipped to the metallurgical laboratory prior to the holiday period.

The water monitoring bores required as part of the EIS process (as announced April 9th) have been established and groundwater monitoring has commenced. Coffey Geotechnics Pty Ltd ("Coffey") have assisted the Company in establishing the bores and will create the groundwater model when sufficient data becomes available. Coffey is a recognised consultancy well-versed in the hydrogeological requirements for mine permitting in NSW.

Planning for the remainder of the resource development drill program has now been completed. The program will entail both RC and diamond core drilling to:

• Increase the confidence of the Lloyds resource to JORC Indicated or better
• Geotechnical drilling for the proposed open pit, process facility and tailings storage facility areas.
• Exploration drilling near the Lloyds Mine.

The preliminary mine site layout is designed to ensure operating costs are minimised. Due to the prospective immediate areas north and south of the Lloyds Mine (see Figure 4), the "exploration" drilling planned is by necessity done at this time to either sterilize the areas for infrastructure planning or drill-prove the copper anomalous areas in which case alternative site designs would be required. The drill-programs will follow the completion of the metallurgical sampling, either before or after the holiday period.

Figure 1 Chalcopyrite in HQ3 core twinning EYMRC-005; interval approaching old mining void.

Figure 2. Metallurgical diamond core drilling commences at Lloyds.

Figure 3 Chalcopyrite in HQ3 core twinning EYMRC-005; interval approaching old mining void.

Figure 4. Priority 1 and 2 targets being drilled directly north and south of the Lloyds Mine.

Figure 5. Location of the Company's Burraga Projects and Regional Geology.

About the Burraga Copper Project

As announced on 9th April 2014, the Company engaged Endure Environmental to carry out an Environmental Impact Study ("EIS"), pivotal to gaining the necessary permits to commence production at the historical Lloyds Mine near the township of Burraga in NSW. The decision to progress towards production is based on the preliminary findings of the 2011 prefeasibility study ("PFS") which is available for reading on the Company's website. The findings suggested an economically viable operation was plausible within a relatively short period and at a relatively low upfront capital investment. The operation is anticipated to yield a cash-flow to allow Elysium to explore the attractive upside potential across its entire tenement holding (refer Figure 5 "priority targets" showing prospective areas near Lloyds Mine).

The Lloyds Copper Mine produced 19,443 tons of Copper from 469,626 tons of ore implying a recovered grade of 4.14% Cu, between 1880 and 1920, then intermittently up to 1961. As a result of mining at the Lloyds Mine, and to a lesser extent at nearby mines, there now exists a tailings dump and two slag dumps of up to 350 Kt. The tailings resource contains a drill proven 234Kt @ 1.2% Cu (see Company website for detail). Metallurgical testing of the tailings confirms a greater than 70% recovery rate from re-processing of the tailings and greater than 50% from re-processing the slag can be expected. The PFS assesses the commercial potential of reprocessing the tailings, slag and hard rock resources from the surface of Lloyds Mine, and concludes that such a project, subject to further testing and financial investigation, is financially and commercially viable with start-up capital expenditure estimated at $10.8 million, generating a net profit of $75 million over 4.4 years of operation.

For further information:

Elysium Resources Limited Elysium Resources Limited Mark Ohlsson Nebojsa Zurkic Company Secretary Technical Director 0400 801 814 03 9329 4075 Email: markohlsson@elysiumresources.com.au Email: nebzurkic@elysiumresources.com.au

For and on behalf of the Board of Directors

Mark Ohlsson, Company Secretary, Elysium Resources Limited

The information in this announcement that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore reserves is based on information reviewed or compiled by Neb Zurkic BAppSc (Geol), MSc (Min & Energy Economics), a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy and a Registered Professional Geoscientist with the Australian Institute of Geoscientists. Mr. Zurkic is employed by Zurkic Mining Consultants Pty Ltd. Mr. Zurkic has sufficient experience that is relevant to the styles of mineralisation and types of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Mineral Resources and Ore Reserves". Mr. Zurkic consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears. Zurkic Mining Consultants Pty Ltd, which is owned and controlled by Mr. Zurkic, owns shares in Elysium Resources.