PATERSON RESOURCES LTD — Capital/Financing Update 2014

Jan 27, 2014

ASX ANNOUNCEMENT 28th January 2014 FOR IMMEDIATE RELEASE

BURRAGA IP SURVEY AND SOIL SAMPLING UPDATE.

Elysium Resources Limited ("Elysium" or "Company") (ASX:EYM) is pleased to provide an update for the ongoing soil sampling and pole-dipole Induced Polarisation (IP) survey over the historical Lloyd's Mine general area.

Highlights

• Strong chargeability highs identified directly south and south-east of Lloyds
• Massive pyrite alteration intersected from surface supports prospectively of SE chargeability high
• Further soil sample results provide support for NS trending chargeability high
• Tailings basement mapping successfully tested - potential increase to resource tonnes

Approximately 55% of the planned IP survey was completed prior to the holiday period with the most northerly line being over the historical Lloyds Mine. Additionally a shorter intermediate line was completed over the main tailings dump to assess whether the basement of the tailings could be mapped. Assay results were also received in January for the final 110 soil samples taken extending the south-south NW-SE oriented grid.

As announced on 28th November 2013, chargeability trends have been associated with conductors identified by an airborne electromagnetic (EM) survey. Two prominent trends are now mapped for in excess of 1.5km, the NE trending high converging with the NS trending high 1.5-2.0 km south of the Lloyds Mine. The anomalies vary up to 200m in width and appear to be stronger at depth, beyond any old workings mapped in the area. Soil sampling results received added to the surface geochemical anomalies that highlight the potential of the area south of Lloyds and in particular the chargeability high at approximately 734,100mE, 6,238,300mN; further sampling to infill this area and better define the anomaly to the west is warranted.

The chargeability high trending north-easterly is stronger and more continuous but seems to have little support from the surface soil sample results. The soil sampling that exists over this trend is older and sampling protocol is not well documented. Apart from the one historical drill-hole collared at the southern-most end which may have drilled through the anomaly, the four drill-holes drilled along the trend collared from the western side were drilled using RC methods and the holes have no record of down-hole surveying.

EYM's experience through its drill campaigns in 2011 and 2012 shows that RC holes drilled towards the east deviate considerably, steepening or even drilling back towards the west; therefore, even the minimal drilling over the SE chargeability trend is likely to have not penetrated the strongest parts of the chargeability high. EYM drilled several shallow holes late in 2013 near the NE high demonstrating the intense level of alteration that has taken place in the area; ZHD-008 was drilled close to the historical hole collared at approximately 734,500mE, 6,237,600mN showing massive pyrite and minor galena from surface (Figure #4). The NE trending high is contained within significant bounding structures mapped at surface, similar to the structural setting hosting Lloyds. The trend also hosts the Sprague's Mine, the second most prominent historical mine in the area after Lloyds. The high at the extreme NE end of the trend and just before a terminating crossstructure seems to form a blind target with no surface soil sampling support and no evidence of historical workings.

Elysium Resources Limited

ABN 45 115 593 005 Suite 705, 3 Spring Street, Sydney NSW 2000 PO Box H238, Australia Square NSW 1215 Phone: +61 2 9247 7744 Fax: +61 2 9247 7244 Email: info@elysiumresources.com.au Web: www.elysiumresources.com.au

The short IP line over the tailings seemed to map the base of tailings remarkably well indicating that the basement is deeper than that assumed for the resource estimate and suggesting that a greater tailings tonnage is present; this would conform with historical estimates of tailings tonnages. Upon return of the survey crew several more lines will be run to create a grid, mapping the resistivity difference between the loose tailings and natural rock surface allowing for an update to the tailings resource estimate.

Planning is currently underway to firm up drill targets and resource updates in 2014; work to include:

• collect further soil samples, infilling areas of interest and replacing historical data deemed suspect
• collate surface mapping over the IP trends to identify areas for potential drilling
• continue IP survey to the north of Lloyds to complete proposed survey and to identify further areas for potential drilling
• complete survey over tailings to map basement via resistivity and provide a resource update

The Company is targeting, on both the north trending western, and NE trending eastern chargeability highs, what may be VMS style Lloyds repeats. Lloyds was mined in late 1800's and early 1900s where the average copper grade recovered over the period was reported at greater than 4% copper.

Elysium Resources Limited Elysium Resources Limited Mark Ohlsson Nebojsa Zurkic Company Secretary Chief Technical Advisor 0400 801 814 03 9329 4075

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.

Email: markohlsson@elysiumresources.com.au Email: n\_zurkic@zurkic-mining-consultants.com

Figure #1. Surface features with chargeability overlay, 100m below natural surface and showing existing drill-hole collars.

Figure #2. Chargeability, 100m below natural surface, overlaid with major structural features and soil sampling results.

Figure #3. Completed IP survey, view of 200m spaced sections lines showing NS and SE trending anomalies.

Figure #4. Hand-held core drilled ZHD-008 over NE high chargeability showing massive pyrite from surface.

The Following table provides explanations required under JORC 2012. It pertains to the Lloyds Mine and areas in immediate vicinity.

		Section 1 Sampling Techniques and Data
--	--	----------------------------------------	--	--

Criteria		JORC Code explanation		Commentary
Samplingtechniques	•	Nature and quality of sampling (e.g. cutchannels, random chips, or specificspecialized industry standard measurementtools appropriate to the minerals underinvestigation, such as down hole gammasondes, or handheld XRF instruments, etc).These examples should not be taken aslimiting the broad meaning of sampling.	•	Surface augur soil samples.
	•	Include reference to measures taken toensure sample representivity and theappropriate calibration of any measurementtools or systems used.	••	Systematic grid of sampling orientedappropriate to the mineralization.Uniform weight collected.
	•	Aspects of the determination ofmineralization that are Material to thePublic Report.	•	VMS and shear hosted mineralization.
	•	In cases where 'industry standard' work hasbeen done this would be relatively simple(e.g. 'reverse circulation drilling was used toobtain 1 m samples from which 3 kg waspulverized to produce a 30 g charge for fireassay'). In other cases more explanationmay be required, such as where there iscoarse gold that has inherent samplingproblems. Unusual commodities ormineralization types (e.g. submarinenodules) may warrant disclosure of detailedinformation.	•	2kg samples of c-horizon collected in thefield.
Drillingtechniques	•	Drill type (e.g. core, reverse circulation,open-hole hammer, rotary air blast, auger,Bangka, sonic, etc) and details (e.g. corediameter, triple or standard tube, depth ofdiamond tails, face-sampling bit or othertype, whether core is oriented and if so, bywhat method, etc).	•	Hand augur used for sample collection.
Drillsamplerecovery	•	Method of recording and assessing coreand chip sample recoveries and resultsassessed.	•	Standard weight collected, recovery in thisinstance is 100%.
	•	Measures taken to maximize samplerecovery and ensure representative natureof the samples.	•	Standard weight collected.
	•	Whether a relationship exists betweensample recovery and grade and whethersample bias may have occurred due topreferential loss/gain of fine/coarsematerial.	•	No bias introduced.

Criteria	JORC Code explanation	Commentary
Logging	•Whether core and chip samples have beengeologically and geotechnically logged to alevel of detail to support appropriateMineral Resource estimation, miningstudies and metallurgical studies.	•Each sample was geologically logged.
	•Whether logging is qualitative orquantitative in nature. Core (or costean,channel, etc) photography.	•Logging is qualitative.
	•The total length and percentage of therelevant intersections logged.	•100% of the 110 soil samples collectedwere logged.
Subsamplingtechniquesandsamplepreparation	•If core, whether cut or sawn and whetherquarter, half or all core taken.	•No core sampling took place in reference tothis announcement.
	•If non-core, whether riffled, tube sampled,rotary split, etc and whether sampled wet ordry.	•Sampling was dry.
	•For all sample types, the nature, quality andappropriateness of the sample preparationtechnique.	•Samples dried and either spilt or sieved to250g at laboratory.
	•Quality control procedures adopted for allsub-sampling stages to maximizerepresentivity of samples.	•Sub-sampling undertaken at the laboratoryonly.
	•Measures taken to ensure that thesampling is representative of the in situmaterial collected, including for instanceresults for field duplicate/second-halfsampling.	•Field duplicates generally not taken unlessconflicting results or other extraneous (e.g.potential contamination from historicalworkings) are suspected. The number ofsamples taken is sufficient to identify broadanomalies which is the explicit purpose ofthe sampling.
	•Whether sample sizes are appropriate tothe grain size of the material beingsampled.	•Samples sizes are appropriate.
Quality ofassay dataandlaboratorytests	•The nature, quality and appropriateness ofthe assaying and laboratory proceduresused and whether the technique isconsidered partial or total.	•All samples prepared and assayed at thecommercial ALS laboratory (Orange).Techniques are appropriate for thesampling being conducted.
	•For geophysical tools, spectrometers,handheld XRF instruments, etc, theparameters used in determining theanalysis including instrument make andmodel, reading times, calibrations factorsapplied and their derivation, etc.	•Geophysical tools not used to determinegrade.
	•Nature of quality control proceduresadopted (e.g. standards, blanks, duplicates,external laboratory checks) and whetheracceptable levels of accuracy (i.e. lack ofbias) and precision have been established.	•Internal standards adopted as well asduplicates. Two separate labs utilized toeliminate bias and achieve acceptable levelof accuracy.
Verificationofsamplingand	•The verification of significant intersectionsby either independent or alternativecompany personnel.	•Soils sample results verified by internalpersonnel.•Geophysical results interpreted and verifiedby independent expert.

Criteria		JORC Code explanation		Commentary
assaying	•	The use of twinned holes.	•	No twinning of augur holes is carried out.
	•	Documentation of primary data, data entryprocedures, data verification, data storage(physical and electronic) protocols.	•	Data is stored both as a hard copy andentered into a commercial database.
	•	Discuss any adjustment to assay data.	•	No adjustments were made to the data.
Location ofdata points	•	Accuracy and quality of surveys used tolocate drill holes (collar and down-holesurveys), trenches, mine workings andother locations used in Mineral Resourceestimation.	•	No Mineral Resource estimation reported inthis instance.
	•	Specification of the grid system used.	•	GDA94 and AMG66.
	•	Quality and adequacy of topographiccontrol.	•	Sufficient accuracy for this stage ofexploration activity.
Dataspacinganddistribution	•	`Data spacing for reporting of ExplorationResults.	••	Soil sampling points are 20m across thepotential strike of the mineralization and on100m fence lines along the strike ofmineralization. Data is being collected inareas previously untested and infillingprevious broader spaced sampling.IP survey lines are 200m spaced lines with50m dipole.
	•	Whether the data spacing and distributionis sufficient to establish the degree ofgeological and grade continuity appropriatefor the Mineral Resource and Ore Reserveestimation procedure(s) and classificationsapplied.	•	No Mineral Resource or Ore Reserveestimation is carried out based on theseresults.
	•	Whether sample compositing has beenapplied.	•	No sample compositing is carried out.
Orientationof data inrelation togeologicalstructure	•	Whether the orientation of samplingachieves unbiased sampling of possiblestructures and the extent to which this isknown, considering the deposit type.	•	The soil sampling grids were oriented sothat the shortest sample distance (20m)was across strike and the longest (100m)sampling distance was along strike. Thesuspected direction of mineralization is inthe NE-SW direction.
	•	If the relationship between the drillingorientation and the orientation of keymineralized structures is considered tohave introduced a sampling bias, thisshould be assessed and reported ifmaterial.	•	Soil auguring is consistently vertical topenetrate the c-horizon and identify areaswhere the surface geology may be ofinterest. Geological orientation isconsidered to maximize the informationgathered through sampling.
Samplesecurity	•	The measures taken to ensure samplesecurity.	•	Soil samples are not stored after assayinghas taken place.
Audits orreviews	•	The results of any audits or reviews ofsampling techniques and data.	•	No audits completed.

Section 2 Reporting of Exploration Results

Criteria	JORC Code explanation	Commentary
Mineraltenement andland tenurestatus	•Type, reference name/number, locationand ownership including agreements ormaterial issues with third parties such asjoint ventures, partnerships, overridingroyalties, native title interests, historicalsites, wilderness or national park andenvironmental settings.	•EL6463•~60km S of Oberon in NSW.•EYM through a subsidiary holds 100%
	•The security of the tenure held at the timeof reporting along with any knownimpediments to obtaining a license tooperate in the area.	•Tenement is in good standing.
Explorationdone by otherparties	•Acknowledgment and appraisal ofexploration by other parties.	•Various operators have held tenure overthe area; Getty Oil, Dominion andRepublic Gold NL have carried out themajority of the most recent work and uponwhich EYM has based its explorationprograms.
Geology	•Deposit type, geological setting and styleof mineralization.	•Within EL6463 copper – gold – silver +/-zinc +/- lead mineralisation is generallyrestricted to the Lloyds corridor, althoughlocalised anomalous base metal valuesalso occur in the Mossgrove Northprospect. The mineralisation is bestdeveloped in the Hanrahan'sAgglomerate but also occurs in the upperpart of the Excelsior Porphyry. At Lloydsmine copper mineralisation occurs as twoquartz – sulphide veins, although mostproduction was from the main vein. Thepredominant sulphide mineral in the veinswas chalcopyrite with sphalerite on thevein walls and pyrrhotite disseminated inthe wall rocks. Galena and tetrahedritewere also reported, but not ateconomically important levels.Disseminate base metal mineralisationwas reported as forming a halo to theveins. The main vein varied in width from0.3m to 12 m, striking roughly east - westand dipping moderately north. The mainvein has a typical strike extent of 180m,terminating in faults at both ends. Theintersection of the terminating faults withthe vein results in the ore plunging to thenortheast.

Criteria	JORC Code explanation	Commentary
Drill holeInformation	•A summary of all information material tothe understanding of the explorationresults including a tabulation of thefollowing information for all Material drillholes:easting and northing of the drill holeocollarelevation or RL (Reduced Level –oelevation above sea level in metres) ofthe drill hole collardip and azimuth of the holeodown hole length and interceptionodepthhole length.o	•Drilling commented on in thisannouncement has been previouslytabulated and reported. Soil samplingresults reported here are not materialindividually and therefore tabulation is notconsidered necessary; results are relevantas a whole and in refence to thegeophysical anomalies and therefore amap is provided (Figure #2) whichoverlays the two datasets in reference toeach other. All soil augur samples arevertical and drilled to penetrate the chorizon and generally not to grater depthsthan 0.5m.
	•If the exclusion of this information isjustified on the basis that the informationis not Material and this exclusion does notdetract from the understanding of thereport, the Competent Person shouldclearly explain why this is the case.	•The exploration results reported aresurface soil samples outlining broadanomalous areas and provide supportingevidence to the geophysics results.
Dataaggregationmethods	•In reporting Exploration Results, weightingaveraging techniques, maximum and/orminimum grade truncations (e.g. cutting ofhigh grades) and cut-off grades areusually Material and should be stated.	•Not used / applied.
	•Where aggregate intercepts incorporateshort lengths of high grade results andlonger lengths of low grade results, theprocedure used for such aggregationshould be stated and some typicalexamples of such aggregations should beshown in detail.	•Not used / applied.
	•The assumptions used for any reporting ofmetal equivalent values should be clearlystated.	•No metal equivalents reported.
Relationshipbetweenmineralizationwidths andinterceptlengths	•These relationships are particularlyimportant in the reporting of ExplorationResults.	•Soil sample spacing and orientation isappropriate to the scale and geometry ofthe mineralization sought.
	•If the geometry of the mineralization withrespect to the drill hole angle is known, itsnature should be reported.	•Geometry of mineralization at Lloyds is ina general NE-SW direction and dips /plunges to the NE. This geometry is usedfor planning of soil sample programs awayfrom Lloyds.
	•If it is not known and only the down holelengths are reported, there should be aclear statement to this effect (e.g. 'downhole length, true width not known').	•Soil sample results are considered pointsamples and not over a length.
Diagrams	•Appropriate maps and sections (withscales) and tabulations of interceptsshould be included for any significantdiscovery being reported These should	•To the extent relevant, maps are includedin the main part of the report.

Criteria	JORC Code explanation	Commentary
Balanced	include, but not be limited to a plan view ofdrill hole collar locations and appropriatesectional views.•Where comprehensive reporting of all	•Reference is made to both significant and
reporting	Exploration Results is not practicable,representative reporting of both low andhigh grades and/or widths should bepracticed to avoid misleading reporting ofExploration Results.	insignificant results which allows theidentification of anomalous areas.
Othersubstantiveexplorationdata	•Other exploration data, if meaningful andmaterial, should be reported including (butnot limited to): geological observations;geophysical survey results; geochemicalsurvey results; bulk samples – size andmethod of treatment; metallurgical testresults; bulk density, groundwater,geotechnical and rock characteristics;potential deleterious or contaminatingsubstances.	•Data considered most comprehensive andmost relevant has been reported.
Further work	•The nature and scale of planned furtherwork (e.g. tests for lateral extensions ordepth extensions or large-scale step-outdrilling).	•Continuation of IP survey northwards ofLloyds.•Airborne EM.•Further soil sampling.•Drill targeting.
	•Diagrams clearly highlighting the areas ofpossible extensions, including the maingeological interpretations and futuredrilling areas, provided this information isnot commercially sensitive.	•Diagrams of the full extent of the IP surveyhave been previously announced.•The airborne EM would be consideredover the entire tenement package.•Further soil and drill programs are yet tobe planned.