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Promising initial assays and further sulphides at Mogoraib North

Sulphides now intersected in three target zones over a two kilometre strike length: drilling continuing

Symbol:  ASX: CHN TSX:  CXN Shares outstanding: 250 million Fully diluted: 255 million

PERTH, Western Australia, Nov. 21, 2012 /CNW/ - Chalice Gold Mines Limited (ASX: CHN/TSX: CXN) is pleased to report further encouraging results from early-stage exploration at its Mogoraib North Copper-Zinc Project in Eritrea, East Africa (Chalice - 60%; Eritrean National Mining Corporation (ENAMCO) - 40%).

Mogoraib North is located 10km north of the world-class Bisha Polymetallic Mine (1.1Moz gold, 1.04Mlbs copper, 35.8Moz silver and 2.68Mlbs zinc*), along the same prospective VMS trend (Figure 1). Chalice's drilling is targeting potential Volcanic Hosted Massive Sulphide ("VHMS") systems similar to Bisha.

The Company has received assay results from previously reported diamond drill-hole MOGD-00021 which intersected a 10m interval of semi-massive to massive pyritic sulphides within a broader 41m wide zone of stringer and disseminated sulphides at the T209 cluster of VTEM anomalies (see ASX Announcement - 1 November 2012).

The laboratory assay results for this intersection are summarised below:

-- 5m grading 0.86% Cu, 1.33% Zn, 0.1g/t Au, 7.48g/t Ag from 145m,

including: o 1m at 1.03% Cu, 2.3% Zn

-- 2.5m grading 0.49% Cu, 1.18% Zn, 0.28g/t Au, 8.22g/t Ag from

154.5m, including: o 1m at 1.25% Cu, 2.55% Zn

MOGD-00021 was drilled to test a VTEM conductor anomaly and coincident gravity anomaly, T209, within a linear cluster of conductor and gravity anomalies extending over a strike length of two kilometres (see Figure 2).

The Company has now completed a further eight wide-spaced diamond holes testing other VTEM conductors and gravity anomalies along this zone.

Pyritic sulphides ranging from disseminated and stringer to semi-massive and massive have been intersected in each of these holes together with visible chalcopyrite and sphalerite. Individual semi-massive to massive sulphide units from 0.5 to 6.5 metres in width occur within broader envelopes of disseminated and stringer sulphides, mainly pyrite and pyrrhotite, associated with intense alteration of the host volcanics.

The widespread occurrence of sulphides and the mineralogy observed in diamond drill core suggests that the intersection in MOGD-00021 may occur on the fringes of a large VHMS system. While a great deal of further drilling and exploration is required, Chalice is very encouraged by the promising results received to date.

Drilling is planned to continue until mid-December with a further 3,000m expected to be completed before the Christmas break. Targets to be tested will include high priority regional VTEM targets as well as further holes within the T209 cluster.

In the meantime, a detailed gravity survey has now been completed over a 12 sq km zone covering the VTEM anomaly trend to refine the previous regional gravity survey data (see Figure 3). This has highlighted several gravity highs on the northern end of the trend as high priority targets.

The Company is currently mobilizing electromagnetic (EM) survey equipment from Australia to commence an extensive program of fixed-loop surface EM and down-hole EM surveys covering the entire prospective corridor. The equipment is expected to be in Eritrea before the end of the month with surveying to commence shortly thereafter and continuing through into 2013.

The EM surveys will provide much greater resolution than the airborne VTEM survey that has guided the drilling to date.

Chalice's Executive Chairman, Tim Goyder, said:

"The results from MOGD-00021, combined with what we have seen in follow-up drilling, have given us confidence that we are onto a significant VHMS system at Mogoraib North that previously lay totally undiscovered beneath shallow cover. 

"The tenor of results seen in the discovery hole is consistent with mineralization often seen on the fringes of a large system like Bisha. The extent of sulphides intersected in the drilling to date gives us great confidence that we are now in a 'hot spot' with outstanding potential to discover economic concentrations of massive sulphide mineralization within the broader system.

"Exploration will now begin to focus on outlining the extent of mineralization and vectoring in on higher grade zones. Our planned surface and down-hole EM surveys will provide the detailed resolution to target ongoing drilling more effectively, providing a significantly more accurate EM model to work from than that generated by the airborne VTEM survey. 

"We are excited by the opportunities unfolding at this project and we plan to intensify our exploration to follow up on the promising results achieved to date."

* On 24(th) June, 2012 Nevsun Resources Limited announced updated Probable Reserves at its Bisha Mine as tabled below.  This is in addition to 2011 gold production of 379,000 oz.


Reserves                                                                 Contained Metal

Zone          Tonnes   Copper   Zinc   Gold    Silver        Cu          Zn       Au       Ag
                          %       %     g/t      g/t        ('000       ('000   ('000    ('000
            ('000's)                                         lbs)        lbs)     Oz)      Oz)

Oxide                                   5.79       35                                  
Phase            900                                    -           -             167    1,020

Supergene                4.09           0.67       28                                  
Phase          6,420                                      578,800   -             138    5,780

Primary                  1.09   6.33    0.72       47                                  
Phase         19,190                                      461,540   2,679,500     441   28,950

Total                                                   1,040,420   2,679,500     746   35,750


Competent Persons and Qualified Person Statement

The information in this news release that relates to exploration results is 
based on information compiled by Dr Doug Jones, a full-time employee and 
Director of Chalice Gold Mines Limited, who is a Member of the Australasian 
Institute of Mining and Metallurgy and is a Chartered Professional Geologist. 
Dr Jones has sufficient experience in the field of activity being reported to 
qualify as a Competent Person as defined in the 2004 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. Dr Jones 
consents to the release of information in the form and context in which it 
appears here.

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 

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 realization 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 coverage.

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 current 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  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 statements.

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

Sampling Procedures and Quality Assurance

Diamond drill core is logged and photographed prior to splitting with a core 
saw. One half of the core is retained on site whilst the other half is bagged 
and dispatched to the Africa Horn Preparation facility (a division of 
NATA‐accredited Intertek‐Genalysis Laboratories) in Asmara for crushing to 
‐2mm and splitting. Certified reference materials (CRMs) are submitted with 
all sample batches at the rate of 1 per 20‐25 routine samples. The CRM's 
inserted have values ranging from very low to high grade. The coarse reject is 
stored and the split sub‐sample is pulverized to a nominal 95% passing ‐75 
micron using an LM2 pulverizer.

The pulverized pulp is further split into two 100g to 150g sub‐samples; a 
primary pulp sample is sent for analysis and a duplicate pulp sample is kept 
as a reference and the remaining fine (-75 micron) reject is stored. A quartz 
wash is pulverized between samples and is stored for random testing of 
preparation contamination.

The sample pulps are transported by air to NATA‐accredited 
Intertek‐Genalysis Laboratories in Perth Western Australia for assay. For 
drill core and RC samples used for resource analysis the majority of gold 
assaying is completed using a lead collection of 50g fire assay method with an 
atomic absorption spectroscopy (AAS) finish. Additional specified 
multi‐element assays are carried out by ICP‐OES on 25g sub‐sample 
prepared using aqua regia digest. Bulk density determinations using water 
immersion method are carried out on every metre of core within expected 
mineralisation and every 10m within waste zones. QA/QC monitoring is applied 
to all drill core assays as per the protocols described above.


Tim Goyder, Executive Chairman Doug Jones, Managing Director Chalice Gold 
Mines Limited Telephone +61 9322 3960  For media inquiries, please contact: 
Nicholas Read Read Corporate Telephone: +618  9388 1474

PDF available at:

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SOURCE: Chalice Gold Mines Limited

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CO: Chalice Gold Mines Limited

-0- Nov/21/2012 14:33 GMT

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