Chalice increases holding in GeoCrystal Limited to 24 per cent

April 14, 2014


Shares outstanding: 297 million

Fully diluted: 299 million

Webb Diamond Project continues to show potential to be a large
kimberlite field


        --  GeoCrystal recently completed a successful exploration program
            at the Webb Diamond Project:
      o 10 kimberlite pipes discovered to date from drill testing of 16
        aeromagnetic targets
      o 4 microdiamonds identified in wide spaced reconnaissance loam
      o 1 microdiamond found in a drill sample over a magnetic kimberlite
      o 3 of the 5 microdiamonds exhibit crystalline habits of diamonds
        derived from kimberlite
      o Diamond indicator minerals identified in 30 out of 67 loam samples,
        outlining a 20km-long anomaly coincident with numerous aeromagnetic
        targets reflecting potential kimberlite pipes
        --  Following the success of this exploration program, Chalice has:
      o Subscribed for 4.25 million shares of GeoCrystal at 20c, as part of
        a 5 million share placement
      o Each share has a free attached option exercisable at 25c expiring
        on the 31st March 2016
      o Exercised 2.1 million GeoCrystal options at 20c (expiring 11 April
        --  GeoCrystal will use the $1.4 million proceeds to fund the next
            phase of the exploration program at the Webb Diamond Projectz
        --  Bill Bent (MD of Chalice) will join the Board of GeoCrystal

WEST PERTH, Western Australia, April 14, 2014 /CNW/ – Following a
successful exploration program at the Webb Diamond Project in Western
Australia, Chalice Gold Mines Limited (“Chalice”) (ASX:CHN; TSX:CXN) is pleased to announce that it has increased its holding in GeoCrystal
Limited (“GeoCrystal”) to 9.68 million shares, which represents 24 per
cent of the issued and outstanding shares of GeoCrystal.

Chalice has agreed to subscribe for 4.25 million shares and 4.25 million
free attaching options in GeoCrystal at an issue price of 20c. Each
attaching option is exercisable at 25c on or before the 31st March
2016. GeoCrystal will place an additional 0.75 million shares under the
same terms, for gross proceeds of $1 million. Additionally, Chalice has
exercised 2.1 million options at 20c which were due to expire on the
29th of March 2014.

Chalice will retain the existing 3,333,333 long dated options received
in the previous round of funding with an exercise price of 20c expiring
in September 2015. Chalice also has a conditional first right of
refusal on future financings until its interest has reached 51 per cent
of GeoCrystal.

Bill Bent, (Managing Director of Chalice) has joined the Board of
GeoCrystal to represent Chalice’s interests.

The proceeds of the capital raising will be used to fund the next stage
of the exploration program at the Webb Diamond Project in Western
Australia. Following this stage of exploration GeoCrystal is expected
to have completed the conditions required to earn 70 per cent of
Meteoric Resources’ (“Meteoric”) (ASX:MEI) interest in the Webb Diamond
Project. The next stage of exploration will consist of two phases:

        --  Phase 1: Flying of 8,000 line-km of 100 metre line spaced
            aeromagnetics over those parts of the project not already
            covered by detailed data to obtain tighter definition of the
            existing 80 plus aeromagnetic targets and assist in
            prioritising the drill targets.  In addition, a further 150
            loam heavy mineral samples will be collected on a broad grid
            pattern over the kimberlite field to analyse for kimberlite
            indicator minerals and micro diamonds.

        --  Phase 2: Completion of up to 6000 metres of Reverse Circulation
            (RC) drilling aimed at testing an additional 50 prioritised
            potential kimberlite targets out of the 80 plus magnetic
            anomalies identified to date.

“We are delighted to have increased our exposure to the Webb Diamond
Project in Western Australia. The recent exploration results continue
to give us encouragement that the project has the potential to be a
large kimberlite field, and this round of funding will allow GeoCrystal
to prioritise and test up to 50 additional magnetic anomalies”, said
Managing Director, Bill Bent.

Exploration Highlights

The recent exploration program completed in December 2013 consisted of
23 aircore holes totalling 1,657 metres to test 16 kimberlite targets.
In addition 46 line-km of ground magnetic surveys have been completed,
together with 67 loam samples totalling 4.9 tonnes of samples taken on
a broad grid pattern over the kimberlite field.

Processing of the 67 loam samples and samples from 22 aircore drill
holes has identified a microdiamond in four of the loam samples and a
single aircore sample. In addition, kimberlite indicator minerals have
been identified in 30 out of the 67 loam samples. The microdiamond and
kimberlite indicator minerals contained in the loam samples outline a
large 20km-long anomaly some 3km to 5km wide, open to the NE,
coincident with numerous kimberlite targets.

One loam sample which contained a microdiamond is located in the eastern
part of the project area in close proximity to drill hole W13AC011 on
Target KJ25 which also reported a microdiamond in a drill sample taken
from overburden sediments directly overlying a kimberlite intersection.

Three of the five microdiamonds that were recovered exhibit
characteristic crystalline habits of diamonds derived from kimberlite,
while the remaining two microdiamonds are irregular shaped fragments.

It should be emphasized that these results are preliminary, with further
validation work, including microprobe analysis of kimberlite indicator
mineral grains, still to be completed. The significance of the reported
results is open to interpretation in that microdiamonds occurring in
surface material can potentially be derived from various sources either
near or distal. However, the occurrence of microdiamonds and indicator
minerals spatially coincident with more than 80 magnetic targets, the
majority of which remain untested, provides a compelling case to
accelerate the pace of exploration in order to assess the diamond
potential of this large kimberlite field.

For further information on the Webb Diamond Project, plus previously
released test work on the kimberlites, please see Meteoric Resources
website (
www.meteoric.com.au), and ASX releases, dated 1 August 2013 and 6 February, 2014.


Managing Director

APRIL 14, 2014

Competent Persons and Qualified Person Statement

The information in this news release that relates to exploration results
is based on information compiled by Mr Thomas Reddicliffe, who is a
Fellow of the Australasian Institute of Mining and Metallurgy. Mr
Reddicliffe is a self-employed consultant to the Meteoric Resources NL
– GeoCrystal Limited joint venture and a director of GeoCrystal
Limited. Mr Reddicliffe has sufficient experience in the field of
activity being reported 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. Mr Reddicliffe consents to the
release of information in the form and context in which it appears

Forward Looking Statements

This document may contain forward-looking information within the meaning
of Canadian securities legislation and forward-looking 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 document and
Chalice Gold Mines Limited (the Company) does not intend, and does not
assume any obligation, to update these forward-looking statements,
except as required by law or regulation.

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, statements with
respect to the estimation of mineral reserves and mineral resources,
the realisation of mineral reserve estimates, the likelihood of
exploration success, 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

In certain cases, forward-looking statements can be identified by the
use of words such as plans, expects or does not expect, is expected,
budget, scheduled, estimates, forecasts, intends, anticipates or does
not anticipate, or believes, 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 include, among others, risks related to
actual results of exploration activities; changes in project parameters
as plans continue to be refined; future prices of mineral resources;
possible variations in ore reserves, grade or recovery rates;
accidents, labour disputes and other risks of the mining industry, 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. 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

Accordingly, readers should not place undue reliance on forward-looking

For media inquiries, please contact:

Nicholas Read

Read Corporate Telephone: +618 9388 1474

SOURCE Chalice Gold Mines Limited

Source: PR Newswire

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