VERITY RESOURCES LIMITED — Capital/Financing Update 2011

Jul 18, 2011

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TO: COMPANY ANNOUNCEMENTS OFFICE ASX LIMITED

Market Cap

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DATE: 19 JULY 2011

Cash

DIBETE DRILLING INTERSECTS SIGNIFICANT MINERALISATION ON SEVERAL STRUCTURES

Issued Capital

The Board of BML has now received the latest drill results for the 6000m drill program completed at the Dibete prospect in Botswana (PL111/94)

Summary

Substantial shareholders

Some of the most significant intercept results from the recent drilling include (see Table 1):-

• 11m @ 4.5% Cu 229.9g/t Ag from 33m in DBRC028 (includes 3m @ 8.16% Cu 469g/t Ag)

• 17m @ 2.7% Cu 41g/t Ag from 16m in DBRC081 (includes 3m @ 6.7% Cu 44.5g/t Ag from 24m & 3m @4.7% Cu 106.9g/t Ag from 27m)

Directors

• 12m @ 1.8% Cu 42g/t Ag from 33m in DBRC094 (includes 4m @ 4.2% Cu 95g/t Ag from 37m)

• 6m @ 2.3% Cu 117g/t Ag from 34m in DBRC097 (includes 2m@ 5.7% Cu 322.5g/t Ag from 34m)

• 9m @ 2.8% Cu 87.3g/t Ag from 33m in DBRC107

• 10m @ 3.9% Cu 110g/t Ag from 43m in DBRC108 (includes 4m @ 9.2% Cu 268g/t Ag from 43m)

• Significant Copper – Silver mineralisation has been intersected along 2 NW-SE trending structures, with mineralisation still open along both structures.

Registered Office

• The mineralisation associated with the line 6100E structure remains open to the North, East and West with a current strike length of 250m.

• Copper and silver has been intersected in both secondary mineralisation (around 18m to 35m depth) and in primary mineralisation (at around 36m to 45m) with best results from this 6000 m RC drilling program in hole DBRC 028 of 3 m at 8.16% Cu and 469 g/t Ag from 41m which underlies 8m @ 3.1% Cu and 140 g/t Ag from 33m in the same hole.

Contact

• Best widths intersected in hole DBRC 081 with 17 m @ 2.73% Cu and 41g/t Ag intersected from 16 m in addition to the previously released intersection in DBRC 014 with 38 m at 1.72% Cu and 119 g/t Ag

• The primary and supergene sulphide mineralised zone consists of chalcocite, pyrite, and bornite vein swarms which are silver rich. The primary mineralisation may extend at depth associated with a VTEM anomaly off to the south. This needs to be confirmed by additional drilling.

• Several other VTEM anomalies have now been interpreted from the recently completed Helicopter VTEM flight program, which are yet to be fully tested.

• Extensive IP and VTEM anomalies remain partly tested at Dibete confirming potential is open at Dibete.

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Details

Results of the drilling at Dibete Copper - Silver prospect, Prospecting Licence 111/94 Botswana.

Drill results

A total of 93 Reverse Circulation (RC) drill holes for 6000 metres were completed at Dibete prospect during March to June 2011. This program (DBRC023-116) was designed to assess the orientation and geometry of the mineralisation intersected in 2010 and also includes several holes at Dibete East. Details of this drilling are shown in Figures 1- 3.

All RC holes were sampled at 1 metre intervals, and analysed for Cu, Pb, Zn, Ni and Ag by ALS Chemex, Johannesburg South Africa. Significant results above a cut off grade of >3000 ppm Cu (0.3%) are shown in Table 1 together with the type of mineralisation intersected (e.g. supergene oxide, supergene sulphide or primary). Drill results for the 2010 program (Holes 1- 22) are also included in Table 1 for reference.

Mineralisation

Four types of mineralisation are evident from this recent drilling program and are related to the degree of oxidation:-

Supergene oxide copper is exposed at surface in outcrops, trenches and old workings, and typically up to 35 metres downhole. Mineralogy consists of malachite, azurite, and chrysocolla. This zone forms a blanket spreading out from the underlying primary mineralisation. RC drill results typically show Cu enrichment concentrated between 18 to 35 metres in this zone.

Topography, fluid pathways, and near surface water flow are believed to be the controlling factors on the distribution of the supergene enriched mineralisation. Current topography may not be the same as topography when the supergene mineralisation precipitated.

A supergene sulphide transition zone is typically found from about 35 to 38 metres downhole consisting of chalcocite and pyrite with minor malachite. Laboratory results show Cu values gradually increase through the transitional zone approaching the primary mineralisation.

From approximately 38 to 41 metres downhole is a mixed primary and supergene sulphide zone consisting of chalcocite, pyrite, and bornite vein swarms with traces of malachite seen on fractures. Assay results indicate the primary bornite vein swarms, as well as the supergene mineralisation, have associated silver.

Below 41 metres there is a sulphide zone with pyrite and minor disseminated chalcopyrite. Sulphides are fresh with minor oxides along fractures.

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Structural Control on the Mineralisation

Preliminary interpretation of the RC assay and geological data was used to construct a wireframe model of the mineralised zones, as shown in Figures 4 -6.

The wireframe model shows the orientation of copper mineralisation using a 1000 ppm (0.1%) Cu cut off. Assays indicate the copper mineralisation, and in particular the bornite veins, have a high silver content. In Figure 5 the oxide and transitional zones are shown as green from 0 to 38 metres downhole. The mixed supergene and primary sulphides zone are shown in purple generally from 38 to 41 metres downhole.

The mineralisation is associated with quartz feldspar gneiss, amphibolite, garnet bearing amphibolite, and micaceous amphibolites. Folding and faulting within the Dibete prospect further complicate the mineralised zones.

From the model the mineralisation is seen to pinch and swell, and to be uplifted or downthrown laterally between holes, This is due to local faulting and folding which is evident at the surface in outcrops and trenches.

The mineralisation intersected is associated with north west - south east trending faults interpreted from satellite imagery. However a regional VTEM survey conducted by African Metals highlighted anomalous zones running north east - south west across both the Dibete and Airstrip prospects parallel to regional tectonic strucure.

The VTEM anomalies at Dibete lie down dip of the regional foliation from the fault controlled supergene mineralisation and may be the ultimate source of fault controlled mineralisation. Further evaluation of the VTEM anomalies will be undertaken to design deep drill holes to test this potential source.

Dibete prospect has similarities to the Airstrip prospect and may be part of a larger mineralised system encompassing the Airstrip prospect 6.5 km to the west-north-west. The area between these two prospects remains untested.

Progress to date on the Dibete Prospect is leading towards defining a body of mineralisation that will have a resource estimation study carried out on it following the next phase of drilling. The close proximity of the Airstrip and Dibete projects, which have similar primary and supergene mineralisation, is considered to be very encouraging.

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Figure 1. Location of drill holes and interpreted fractures at Dibete prospect. The green square is the area of detailed drilling shown in Figure 2. Supergene copper workings are shown in green. Holes with visible mineralisation logged have a yellow collar location.

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Figure 2. Visible intersections of mineralisation outlined in brown. Note that most outlined areas are not constrained by drilling to date and tend to have a north west trend.

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Figure 3. Detailed drilling area around Line 6100E, Dibete prospect. Supergene workings are shown in green. Holes with visible mineralisation logged have a yellow collar location. Blue traces are axes of ground EM anomalies which are coincident with the main IP anomaly axis.

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Figure 4. Plan view of the modeled copper mineralisation superimposed over the IP resistivity low anomaly. The IP anomaly trends north east while the mineralisation follows structures that trend north west.

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Figure 5. Long section on local grid line 6100E showing supergene oxide mineralisation in green and supergene sulphide and primary mineralisation in purple.

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Figure 6. Cross Section through mineralisation located along local grid line 6100E. Note the supergene copper mineralisation is approximately 40 metres wide and located at shallow depth.

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Table 1. Significant Results from Dibete Project >0.3% Cut Off Grade.

Hole ID	Depth From m	Depth To m	Interval m	Avg Cu %	Avg Ag g/t	Mineralisation Type	Local Grid Line
DBRD-004	3	4	1	0.40	<3	Supergene oxide
DBRD-004	27	36	9	0.95	19.0	Supergene oxide	Line 6400
including	27	31	4	1.28	25.4	Supergene oxide
DBRD-005	8	11	3	0.69	8	Supergene oxide
DBRD-005	14	15	1	0.35	3.6	Supergene oxide
DBRD-005	22	28	6	0.51	<3	Supergene oxide
including	23	24	1	1.06	<3	Supergene oxide	Line 6400
DBRD-005	31	35	4	0.70	4.1	Supergene + primary
DBRD-005	41	42	1	0.43	<3	Supergene + primary
DBRD-005	46	47	1	0.52	4.2	primary
DBRD-006	24	40	17	1.94	31	Supergene oxide
including	26	31	5	4.19	90.5	Supergene oxide	Line 6100
DBRD-006	40	42	3	0.58	4.1	Supergene + primary
DBRD-013	32	40	8	0.78	22.75	Supergene oxide
including	37	39	2	2.62	40	Supergene oxide
							Line 6100
DBRD-013	40	50	10	1.13	160	Supergene + primary
including	42	45	3	8.01	192	Supergene + primary
DBRC-014	16	37	21	1.32	67.7	Supergene oxide
including	27	37	10	2.33	126.5	Supergene oxide
including	39	42	3	1.6	27.8	Supergene oxide
							Line 6100
DBRC-014	44	52	8	3.86	364.1	Primary + supergene
including	48	51	3	9.16	894	Primary + supergene
DBRC-014	53	54	1	0.8	17.9	Primary + supergene

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Hole ID	Depth From m	Depth To m	Interval m	Avg Cu %	Avg Ag g/t	Mineralisation Type	Local Line	Grid
DBRC-026	5	6	1	0.59	6	Supergene oxide	line	6100
DBRC-026	13	16	3	1.29	7	Supergene oxide
DBRC-028	33	44	11	4.48	229.9	Supergene +primary
							Line	6100
including	41	44	3	8.16	469	Supergene + primary
DBRC-030	6	8	2	0.40	11.7	Supergene oxide
DBRC-030	18	25	7	1.39	22.2	Supergene oxide
							Line	6100
including	18	19	1	6.78	114	Supergene oxide
DBRC-030	37	39	2	2.0	0.5	Supergene + primary
DBRC-046	14	15	1	0.4	0.02	Supergene oxide	Line	6400
DBRC-046	27	29	2	1.41	0.6	Supergene oxide
DBRC-048	0	1	1	0.5	3.5	Supergene oxide
							Line	6400
DBRC-048	15	17	2	0.99	0.9	Supergene oxide
DBRC-054	40	41	1	0.53	0.3	Primary	Line	6600
DBRC-079	30	32	2	1.62	1.6	Primary + supergene
DBRC-079	34	35	1	.69	4.2	Primary + supergene	Line	6100
DBRC-079	38	39	1	0.36	4.3	Primary
DBRC-081	16	33	17	2.73	40.5	Supergene + primary
including	24	27	3	6.69	44.5	Supergene oxide
							Line	6100
including	27	33	6	2.63	57.5	Primary + supergene
including	27	30	3	4.68	106.9	Primary + supergene

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Hole ID	Depth From m	Depth To m	Interval m	Avg Cu %	Avg Ag g/t	Mineralisation Type	Local Line	Grid
DBRC-082	15	28	13	0.93	8.4	Supergene oxide
including	23	27	4	1.32	6.2	Supergene oxide	Line	6100
DBRC-082	40	41	1	0.52	2.9	primary
DBRC-089	18	28	3	1.02	3.97	Supergene oxide
							Line	6100
including	18	20	2	1.89	16.2	Supergene oxide
DBRC-090	28	29	1	0.39	<0.2	Supergene oxide
							Line	6100
including	36	38	2	6.25	214	Supergene + primary
DBRC-094	0	2	2	0.49	1.7	Supergene oxide
DBRC-094	33	45	12	1.78	42	Supergene oxide
							Line	6100
Including	37	41	4	4.21	95	Supergene oxide
DBRC-094	52	54	2	0.53	31.2	Supergene oxide
DBRC-097	23	26	3	0.43	8.1	Supergene oxide
DBRC-097	34	40	6	2.27	117	Supergene + primary	Line	6100
including	34	36	2	5.7	322.5	Supergene oxide
DBRC-098	17	24	7	1.2	14.5	Supergene oxide
including	19	23	4	1.80	23.6	Supergene oxide
							Line	6100
DBRC-098	31	35	4	1.75	1.1	Supergene + primary
including	32	35	3	2.18	1.2	Supergene + primary
DBRC-099	37	46	9	1.82	68.9	Supergene + primary
							Line	6100
including	37	43	6	2.49	95.8	Supergene + primary
DBRC-100	27	35	8	1.44	66.2	Supergene oxide
including	27	30	3	3.39	168	Supergene oxide
							Line	6100
DBRC-100	35	40	5	3.58	196	Supergene + primary
Including	38	39	1	10.4	620	Supergene + primary

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Hole ID	Depth From m	Depth To m	Interval m	Avg Cu %	Avg Ag g/t	Mineralisation Type	Local Grid Line
DBRC-101	48	49	1	0.81	21.4	Primary
							Line 6100
DBRC-101	51	52	1	0.33	0.9	Primary
DBRC-104	3	24	21	0.81	21.7	Supergene oxide
							Line 6100
including	6	9	3	2.89	65.0	Supergene oxide
DBRC-106	45	46	1	0.53	<0.2	Supergene oxide	Line 6100
DBRC-107	0	3	3	0.39	<0.2	Supergene oxide
DBRC-107	6	11	5	0.43	0.9	Supergene oxide
DBRC-107	14	23	9	0.49	4.6	Supergene oxide
DBRC-107	24	25	1	0.34	4.1	Supergene oxide
							Line 6100
DBRC-107	26	27	1	0.48	8.2	Supergene oxide
DBRC-107	31	33	2	0.46	8.4	Supergene oxide
DBRC-107	33	42	9	2.78	87.3	Primary + supergene
including	35	40	5	4.46	183	Primary + supergene
DBRC-107	43	45	2	0.53	7.2	Primary + supergene	Line 6100
DBRC-108	37	38	1	0.72	0.3	Primary + supergene
DBRC-108	43	53	10	3.86	110	Primary + supergene	Line 6100
including	43	47	4	9.16	268	Primary + supergene
DBRC-110	15	23	8	1.07	<0.2	Supergene oxide
including	17	21	4	1.69	<0.2	Supergene oxide	Line 6100
DBRC-110	28	29	1	0.42	0.5	Supergene oxide

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Hole ID	Depth From m	Depth To m	Interval m	Avg Cu %	Avg Ag g/t	Mineralisation Type	Local Grid Line
DBRC-111	23	25	2	0.41	1.7	Primary + supergene
DBRC-111	44	51	7	2.1	49.7	Primary + supergene	Line 6100
including	45	48	3	4.08	100	Primary + supergene
DBRC 113	24	25	1	0.42	1.9	Supergene oxide
							Line 6100
DBRC-113	40	42	2	1.16	0.2	Supergene oxide
DBRC-114	4	5	1	0.4	0.8	Supergene oxide
DBRC 114	24	37	13	1.23	36.1	Supergene oxide
							Line 6400
including	26	33	7	1.82	53.5	Supergene oxide
DBRC 114	40	44	4	2.57	61.7	Primary + supergene

The information in this report that relates to Exploration Results is based on information compiled by Mr Peter Temby, a consultant employed by Anpet Exploration Pty Ltd and a member of The Australian Institute of Geoscientists.

Mr Temby has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activities which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Temby consents to the inclusion in this report of matters based on his information in the form and context in which it appears.