SANDFIRE RESOURCES LIMITED — Capital/Financing Update 2015

Jul 19, 2015

20 July 2015

COMPANY SNAPSHOT

Monty Drilling Update Step out "pre-collar" RC drill-hole intersects 18 metres of massive sulphides at 108 metres downhole

Board of Directors

Alan Senior Non-Executive Chairman

Gary Lethridge Managing Director

Brian Dawes Non-Executive Director

Karen Gadsby Non-Executive Director

Contact Details

6 Centro Avenue Subiaco, Western Australia, 6008

Telephone: +61 8 9380 4230

Facsimile: +61 8 9382 8200

Email: info@talismanmining.com.au

Website: www.talismanmining.com.au

Capital Structure

Shares on Issue: 148,559,904 (TLM)

Options on Issue: 7,250,000 (Unlisted)

ASX: TLM

Talisman Mining Limited (ASX: TLM "Talisman") is pleased to announce that Sandfire Resources NL (ASX: SFR; "Sandfire") has provided an update on ongoing diamond drilling being undertaken at the Monty Prospect within Talisman's Springfield Project located approximately 10km east of the DeGrussa Copper Mine (see Figure 1).

The Springfield Project is subject to an exploration farm-in joint venture between Sandfire and Talisman where Sandfire has the right to earn up to a 70% interest in Talisman's Doolgunna Projects by the expenditure of $15 million on exploration at the Projects.

An RC drill hole, TLRC0004, which is being drilled at Monty as a pre-collar for a diamond step out drill-hole approximately 135m along strike from the recently reported massive sulphide intercept in TLDD0005, has intersected 18 metres of massive sulphides from 108.0m to 126.0m down-hole. Note, all widths are down-hole as true widths are not currently known.

Based upon field observations by Sandfire, the massive sulphides intersected in TLRC0004 also contain visible chalcopyrite and will be despatched by Sandfire for assaying.

This new intersection (TLRC0004) is located approximately 135 metres along strike to the south-west from the massive sulphide intersection reported in TLDD0005 (9.2 metres from 417m down-hole (see TLM ASX announcement – 14 July 2015) and approximately 200 metres along strike from the high-grade intersection in TLDD0004A (16.5 metres @ 18.9% Cu and 2.1 g/t Au from 409.5m down-hole (see TLM ASX announcement – 25 June 2015). The location of the holes is shown in Figure 2.

It is important to note that, while the new intersection in TLRC0004 increases the known footprint of mineralisation at Monty, the continuity with the mineralisation seen in holes TLDD0004A and TLDD0005 is not currently known. Further drilling will be undertaken to determine the geological setting.

Sandfire advise that drilling of TLRC0004 will continue to a planned depth of approximately 400m to provide optimal coupling in planned follow up down-hole electromagnetic (DHEM) surveying.

Drilling of step-out diamond drill-hole TLDD0006, approximately 80 metres along strike to the south-west from the massive sulphide mineralisation intersection reported in TLDD0005, is also continuing towards its target depth.

Assays from TLDD0005 are awaited.

Talisman's Managing Director, Gary Lethridge, said that the discovery of a relatively near surface zone of massive sulphides at Monty was an exciting exploration development.

"This new intercept from RC drilling along strike at Monty is considerably shallower than any previous massive sulphide intersections in the area and extends the known potential footprint of mineralisation in this emerging prospect," Mr Lethridge said.

"While it is early days at Monty, with a considerable amount of work still required to be undertaken in order to understand the geological context and significance of the recent exploration results, this is clearly a very exciting and encouraging development for both Talisman and Sandfire."

ENDS

For further information, please contact: For media inquiries, please contact: Gary Lethridge – Managing Director Nicholas Read – Read Corporate on +61 8 9380 4230 on +61 419 929 046

Competent Person's Statement

Information in this ASX release that relates to Exploration Results and Mineral Resources is based on information compiled by Mr Graham Leaver, who is a member of the Australian Institute of Geoscientists. Mr Leaver is a full time employee of Talisman Mining Ltd and has sufficient experience which is relevant to the style of mineralisation and types of deposit under consideration and to the activities undertaken to qualify as a Competent Person as defined in the 2012 Edition of the "Australian Code for Reporting of Mineral Resources and Ore Reserves". Mr Leaver consents to the inclusion in this report of the matters based on information in the form and context in which it appear.

Table 1 – Drill-hole Information Summary, Springfield Project

Details and co-ordinates of the historical drill-hole SPD021 and recent drill holes completed by Sandfire at the Springfield Project, TLDD0001, TLDD0002A, TLDD0003 and TLDD0004A, together with details of step-out drill holes TLDD0005 and TLDD0006 and the new RC hole TLRC0004 are provided below:

Hole ID	Depth	Dip	Azimuth	Grid_ID	East	North	RL	Lease ID	Hole Status
SPD021	553	-60°	180°	MGA94_50	743598	7171437	598	E52/2282	Complete
TLDD0001	1099	-60°	360°	MGA94_50	740146	7174149	589	E52/2313	Complete
TLDD0002A	500	-60°	112°	MGA94_50	743544	7171211	602	E52/2282	Complete
TLDD0003	658	-60°	360°	MGA94_50	740596	7174550	589	E52/2282	Complete
TLDD0004A	817	-60°	148°	MGA94_50	743588	7171281	601	E52/2282	Complete
TLDD0005	478	-62°	139°	MGA94_50	743544	7171211	602	E52/2282	Complete
TLDD0006	Ongoing	-62°	138°	MGA94_50	743479	7171160	602	E52/2282	In Progress
TLRC0004	Ongoing	-62°	143°	MGA94_50	743497	7171025	605	E52/2282	In Progress

Figure 1: Talisman's Doolgunna Copper-Gold Projects subject to the $15M Exploration Farm-In Joint Venture with Sandfire Resources NL

Figure 2 – Plan view showing location of recent exploration drilling relative to the DeGrussa Copper Mine, including the high-grade intersection in TLDD0004A, step-out hole TLDD0005, TLD0006 and the new intersection in TLRC0004.

Appendix 1 - JORC TABLE 1

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections)

Criteria	JORC Code explanation	Commentary
Samplingtechniques	Nature and quality of sampling (e.g. cutchannels, random chips, or specificspecialised industry standardmeasurement tools appropriate to theminerals under investigation, such asdown-hole gamma sondes, or handheldXRF instruments, etc). These examplesshould not be taken as limiting the broadmeaning of sampling.Include reference to measures taken toensure sample representivity and theappropriate calibration of anymeasurement tools or systems used.Aspects of the determination ofmineralisation that are Material to thePublic Report.In cases where 'industry standard' workhas been done this would be relativelysimple (e.g. 'reverse circulation drillingwas used to obtain 1 m samples fromwhich 3 kg was pulverised to produce a30 g charge for fire assay'). In othercases more explanation may be required,such as where there is coarse gold thathas inherent sampling problems.Unusual commodities or mineralisationtypes (e.g. submarine nodules) maywarrant disclosure of detailedinformation.	The samplingmethod employed by Sandfirei shalf-coresamplingofNQ2corefromdiamonddrilling (DD)Sampling is guided by Sandfire protocols as perindustry standard.Sample size reduction is through a Jaques jawcrusher to -10mm and all samples are Boydcrushed to -4mm and pulverised via LM5 tonominal 90% passing -75µm using wet sievingtechnique.SamplesareassayedusingMixed4AcidDigest (MAD) 0.3g charge and MAD Hotbox 0.15gcharge methods with ICPOES or ICPMS.Fire Assay is completed by firing 40g portion of thesample with ICPMS finish.
Drillingtechniques	Drill type (e.g. core, reverse circulation,open-holehammer,rotaryairblast,auger, Bangka,sonic, etc) and details(e.g. core diameter,triple or standardtube,depthofdiamondtails,facesampling bit or other type, whether coreis oriented and if so, by what method,etc).	Sandfire diamond drilling is completed using NQ2size coring equipment.All drill collars are surveyed using RTK GPS.All core, where possible is oriented using a ReflexACT II RD orientation tool.Downholesurveyingisundertakenusingagyroscopic survey instrument.

	TALISMANMINING LIMITEDASX Code: TLMMonty Drilling Update
Drillsamplerecovery	Method of recording and assessing core$\bullet$and chip sample recoveries and resultsassessed.Measures taken to maximise sample$\bullet$recovery and ensure representativenature of the samples.Whether a relationship exists between$\bullet$sample recovery and grade and whethersample bias may have occurred due topreferential loss/gain of fine/coarsematerial.	Sandfire diamond core recovery is logged andcaptured into the database. Core recoveries aremeasured by drillers for every drill run. The corelength recovered is physically measured for eachrun and recorded and used to calculate the corerecovery as a percentage of core recovered.Appropriate measures are taken to maximisesample recovery and ensure the representativenature of the samples. This includes diamond corebeing reconstructed into continuous intervals onangle iron racks for orientation, metre marking andreconciled against core block markers.Samples are routinely weighed and the informationcaptured into the central secured database.No sample recovery issues have impacted onpotential sample bias
Logging	Whether core and chip samples have$\bullet$been geologically and geotechnicallylogged to a level of detail to supportappropriate Mineral Resource estimation,mining studies and metallurgical studies.Whether logging is qualitative or$\bullet$quantitative in nature. Core (or costean,channel, etc) photography.The total length and percentage of the$\bullet$relevant intersections logged.	Sandfire Geological logging is completed for all$\bullet$holes and is representative across the orebody.The lithology, alteration and structuralcharacteristics of core are logged directly to adigital format following procedures, and usingSandfire NL geologic codes. Data is imported intoSandfire NL's central database after validation inLogChief™.Logging is both qualitative and quantitativedepending on field being logged.All cores are photographed.All drill holes are fully logged.
Sub-samplingtechniquesandsamplepreparation	If core, whether cut or sawn and whetherquarter, half or all core taken.If non-core, whether riffled, tube$\bullet$sampled, rotary split, etc and whethersampled wet or dry.For all sample types, the nature, quality$\bullet$and appropriateness of the samplepreparation technique.Quality control procedures adopted for all$\bullet$sub-sampling stages to maximiserepresentivity of samples.Measures taken to ensure that the$\bullet$sampling is representative of the in situmaterial collected, including for instanceresults for field duplicate/second-halfsampling.Whether sample sizes are appropriate to$\bullet$the grain size of the material beingsampled.	Sandfire complete diamond core orientation$\bullet$where possible and all core is marked prior tosampling. Half core samples are produced usingan Almonte Core Saw. Samples are weighed andrecorded.All samples are sorted, dried at 80° for up to 24hours and weighed. Samples are then crushedthrough a Jaques crusher to nominal -10mm. Asecond stage crushing is through a Boyd crusherto nominal -4mm. Sample splits are weighed at afrequency of 1:20 and entered into the job resultsfile. Pulverising is completed using LM5 mill to90% passing 75%um using wet sieving technique.1:20 grind quality checks are completed for 90%$\bullet$passing75%µmcriteriatoensurerepresentativeness of sub-samples.Sampling is carried out in accordance with٠Sandfire protocols as per industry best practice.No field duplicates have been taken.$\bullet$The sample sizes are considered appropriate for$\bullet$VHMS and Gold mineralisation types.

Monty Drilling Update	TALISMANMINING LIMITEDASX Code: TLM
Quality ofassay dataandlaboratorytests	The nature, quality and appropriatenessof the assaying and laboratoryprocedures used and whether thetechnique is considered partial or total.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.Nature of quality control proceduresadopted (e.g. standards, blanks,duplicates, external laboratory checks)and whether acceptable levels ofaccuracy (i.e. lack of bias) and precisionhave been established.	Samples are assayed using Mixed 4 Acid Digest(MAD) 0.3g charge and MAD Hotbox 0.15g chargemethods with ICPOES or ICPMS. The samples aredigested and refluxed with a mixture of acidsincluding Hydrofluoric, Nitric, Hydrochloric andPerchloric acids and analysis conducted for multielements including Cu, Pb, Zn, Ag, As, Fe, S, Sb,Bi, Mo, Re, Mn, Co, Cd, Cr, Ni, Se, Te, Ti, Zr, V,Sn, W and Ba. The MAD Hotbox method is anextended digest method that approaches a totaldigest for many elements however some refractoryminerals are not completely attacked. Theelements S, Cu, Zn, Co, Fe, Ca, Mg, Mn, Ni, Cr, Ti,K, Na, V are determined by ICPOES, and Ag, Pb,As, Sb, Bi, Cd, Se, Te, Mo, Re, Zr, Ba, Sn, W aredetermined by ICPMS. Samples are analysed forAu, Pd and Pt by firing a 40g of sample with ICPAES/MS finish. Lower sample weights areemployed where samples have very high Scontents. This is a classical FA process and resultsin total separation of Au, Pt and Pd in the samples.The analytical methods are considered appropriate$\bullet$for this mineralisation styles.No geophysical tools are used in the analysis.Sandfire DeGrussa QAQC protocol is consideredindustry standard with standard reference material(SRM) submitted on regular basis with routinesamples. SRMs and blanks are inserted at aminimum of 5% frequency rate.
Verificationofsamplingandassaying	The verification of significant$\bullet$intersections by either independent oralternative company personnel.The use of twinned holes.$\bullet$Documentation of primary data, data٠entry procedures, data verification, datastorage (physical and electronic)protocols.Discuss any adjustment to assay data.	Significant intersections have been verified by$\bullet$alternate Sandfire personnel.No twinned holes are being drilled as part of thisprogramme.Primary data is captured on field Toughbooklaptops using Logchief™ Software. The softwarehas validation routines and data is then importedinto a secure central database.The primary data is always kept and is neverreplaced by adjusted or interpreted data.

Location ofdata points	TALISMANMINING LIMITEDASX Code: TLMMonty Drilling Update• Accuracy and quality of surveys used tolocate drill holes (collar and down- holesurveys), trenches, mine workings andother locations used in Mineral Resourceestimation.Specification of the grid system used.٠Quality and adequacy of topographiccontrol.	The Sandfire Survey team undertakes surveyworks under the guidelines of best industrypractice.All drill collars are accurately surveyed using RTK$\bullet$GPS system within +/-50mm of accuracy (X, Y, Z).Coordinates are based on control previously$\bullet$established by MHR Surveyors which was derivedby ties into the Government SSM/BM network.Downhole surveys are completed by gyroscopic$\bullet$downhole methods at regular intervals.Coordinate and azimuth are reported in MGA 94 Zone٠50.Topographic control was established from aerial٠
Dataspacinganddistribution	• Data spacing for reporting of ExplorationResults.Whether the data spacing and distributionis sufficient to establish the degree ofgeological and grade continuityappropriate for the Mineral Resource andOre Reserve estimation procedure(s)and classifications applied.Whether sample compositing has beenapplied.	photography using a series of 33 surveyed controlpoints.TLDD0004A was the first drill hole to intersect the$\bullet$modelled EM plate.TLDD0005 has intersected massive sulphide٠mineralisation approximately 70 metres alongstrike to the south-west from the massive sulphidemineralisation intersected in drill hole TLD0004A.TLRC0004 has intersected massive sulphide$\bullet$mineralisation approximately 135 metres alongstrike to the south-west from the massive sulphideintersection reported in TLDD0005.It is not possible to make any conclusion regarding$\bullet$sample spacing and distribution.
Orientationof data inrelation togeologicalstructure	Whether the orientation of sampling$\bullet$achieves unbiased sampling of possiblestructures and the extent to which this isknown, considering the deposit type.If the relationship between the drilling$\bullet$orientation and the orientation of keymineralised structures is considered tohave introduced a sampling bias, thisshould be assessed and reported ifmaterial.	No significant orientation based sampling bias is$\bullet$known at this time.Drill holes are oriented to intersect a modelled EM$\bullet$plate and interpreted stratigraphy. The drill holesmay not necessarily be perpendicular to theorientation of the intersected mineralisation. Allreported intervals are downhole intervals, not truewidths.
Samplesecurity	• The measures taken to ensure samplesecurity.	Sandfire ensures appropriate security measures$\bullet$are taken to dispatch samples to the laboratory.Chain of custody of samples is being managed bySandfire Resources NL. Samples are stored onsiteand transported to laboratory by a licence transportcompany in sealed bulka bags. The laboratoryreceipts received samples against the sampledispatch documents and issues a reconciliationreport for every sample batch.
Audits orreviews	The results of any audits or reviews of$\bullet$sampling techniques and data.	Sandfire have not completed any external audits$\bullet$or reviews of the sampling techniques and data

Section 2 Reporting of Exploration Results (Criteria in this section apply to all succeeding sections)

Criteria	JORC Code explanation	Commentary
Mineraltenement andland tenurestatus	Type, reference name/number, locationand ownership including agreements ormaterial issues with third parties suchas joint ventures, partnerships,overriding royalties, native titleinterests, historical sites, wilderness ornational park and environmentalsettings.The security of the tenure held at thetime of reporting along with any knownimpediments to obtaining a licence tooperate in the area.	Diamond and RC drilling by Farm-in PartnerSandfire is on tenements E52/2313 and E52/2282.Tenements E52/2282, E52/2313 and E52/2466form Talisman's 100% owned Springfield Project,150km north-east of Meekatharra, WA. Sandfire iscurrently farming into the project on a staged basiswith the right to earn 70% interest in the projectAll tenements are current and in good standing.The Talisman tenements are currently subject to aNative Title Claim by the Yungunga-Nya People(WAD6132/98). Sandfire currently has a LandAccess Agreement in place with the Yungunga-NyaNative Title Claimants and have assumedmanagement of Heritage Agreements which wereexecuted by Talisman. These agreements allowSandfire to carry out mining and explorationactivities on their traditional land.
Explorationdone by otherparties	Acknowledgment and appraisal ofexploration by other parties.	Aside from Sandfire Resources and TalismanMiningLimitedtherehasbeennorecentexploration undertaken on the Talisman Project.Historic exploration work at Springfield completedprior to Talisman's tenure included geochemicalsoil and rock chip sampling combined withgeological mapping. Some targeted RC drillingwas completed over gold and diamond targets.
Geology	Deposit type, geological setting andstyle of mineralisation.	Talisman's Doolgunna Project lies within theProterozoic-aged Bryah rift basin enclosed betweenthe Archaean Marymia Inlier to the north and theProterozoic Yerrida basin to the south.The principal exploration targets at the DoolgunnaProjects are Volcanogenic Massive Sulphide (VMS)deposits located with the Proterozoic Bryah Basin ofWestern Australia.

ASX Code: TLMMonty Drilling Update	TALISMANMINING LIMITED
Drill holeInformation	A summary of all information material to$\bullet$the understanding of the explorationresults including a tabulation of thefollowing information for all Material drillholes:easting and northing of the drill hole$\circ$collarelevation or RL (Reduced Level -$\circ$elevation above sea level in metres)of the drill hole collardip and azimuth of the hole$\circ$down hole length and interception$\circ$depthhole length.OIf the exclusion of this information isjustified on the basis that theinformation is not Material and thisexclusion does not detract from theunderstanding of the report, theCompetent Person should clearlyexplain why this is the case.	Refer to Table 1 of this document - DrillholeInformation Summary, Springfield Project.
Dataaggregationmethods	In reporting Exploration Results,٠weighting averaging techniques,maximum and/or minimum gradetruncations (e.g. cutting of high grades)and cut-off grades are usually Materialand should be stated.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 shouldbe shown in detail.The assumptions used for any reporting٠of metal equivalent values should beclearly stated.	Significant intersections are based on greater than$\bullet$0.5% Cu and may include up to a maximum of3.0m of internal dilution, with a minimumcomposite grade of 1.0% Cu.Cu grades used for calculatingsignificant٠intersections are uncut.Reported intersections are based on a regularsample interval of 1m or 5m composites in regulardrilling subject to location of geological boundaries.Minimum and maximum sample intervals used for$\bullet$intersection calculation are 0.3m and 1.2mrespectively.No metal equivalents are used in the intersection$\bullet$calculation.Where core loss occurs; the average length-$\bullet$weighted grade of the two adjacent samples areattributed to the interval for the purpose ofcalculating the intersection. The maximum intervalof missing core which can be incorporated withthe reported intersection is 1m.
Relationshipbetweenmineralisationwidths andinterceptlengths	These relationships are particularly$\bullet$important in the reporting of ExplorationResults.If the geometry of the mineralisation$\bullet$with respect to the drill-hole angle isknown, its nature should be reported.If it is not known and only the down$\bullet$hole lengths are reported, there shouldbe a clear statement to this effect (e.g.'down hole length, true width notknown').	Downhole intercepts of mineralisation reported in٠this release are from a drill hole orientatedperpendicular to a modelled EM plate. The drillhole may not necessarily be perpendicular to themineralised zone. All widths reported are downholeintervals.The geometry of the mineralisation, relative to the$\bullet$drill hole, is unknown at this stage.All intersections reported in this release are$\bullet$downhole intervals. True widths are not known.

ASX Code: TLMMonty Drilling Update	TALISMANMINING LIMITED
Diagrams	Appropriate maps and sections (with$\bullet$scales) and tabulations of interceptsshould be included for any significantdiscovery being reported These shouldinclude, but not be limited to a planview of drill hole collar locations andappropriate sectional views.	Appropriate maps with scale are included withinthe body of the accompanying document.
Balancedreporting	Where comprehensive reporting of all٠Exploration Results is not practicable,representative reporting of both low andhigh grades and/or widths should bepracticed to avoid misleading reportingof Exploration Results.	The accompanying document is considered torepresent a balanced report.
Othersubstantiveexplorationdata	Other exploration data, if meaningfuland material, should be reportedincluding (but not limited to): geologicalobservations; geophysical surveyresults; geochemical survey results;bulk samples - size and method oftreatment; metallurgical test results;bulk density, groundwater, geotechnicaland rock characteristics; potentialdeleterious or contaminatingsubstances.	Other exploration data collected is not considered$\bullet$as material to this document at this stage. Furtherdata collection will be reviewed and reported whenconsidered material.
Further work	The nature and scale of planned further$\bullet$work (e.g. tests for lateral extensions ordepth extensions or large-scale step-out drilling).Diagrams clearly highlighting the areasof possible extensions, including themain geological interpretations andfuture drilling areas, provided thisinformation is not commerciallysensitive.	Sandfire have indicated to TLM that additional downhole geophysics (DHEM) and drilling will occur todefine the extent of the intersected mineralisation