CH

RY

SA

LIS

RE

SO

UR

CE

S

LIM

ITE

D

ZAMBIAN EXPLORATION UPDATE

ASX Announcement 16th June 2014

Chrysalis Resources Limited Company Snapshot

Listed on ASX 27 May 2008

ASX Share Code CYS

Sector Exploration

Company Structure

No of Shares on Issue 228,989,419 (as at 31st March 2014)

Cash (at 31st March 2014) $1.44M

Board & Management

Dr Neale Fong – Non-Executive Chairman

Mr Jian Hua Sang – Non-Executive Director

Mr Michael Griffiths – Non-Executive Director

Ms Michelle Wang – Executive Director

Mr Leigh Ryan – CEO

Mr Kevin Hart – Company Secretary

A.B.N 58 125 931 964

Level 1, Suite 20

7 The Esplanade

MT. PLEASANT WA 6153

Phone: 618 6180 9290

Fax: 618 9316 1314

E: info@chrysalisresources.com.au

www.chrysalisresources.com.au

ZAMBIAN EXPLORATION HIGHLIGHTS

Evaluation of the Mwongo Project multi-element soil sampling data confirms the presence of

a large syenite intrusive with highly elevated uranium levels at the south-western end of a

9km long, up to 1.8km wide Cu/Sc-in-soil ratio anomaly with coincident elevated Ag-Na-U and

low Ti levels. The soil geochemistry associated with the syenite shows good potential for

Kitumba style Iron Oxide Copper Gold (IOCG) mineralisation and forms the main exploration

target for Cu mineralisation within the project. Infill soil sampling and drilling is planned.

Infill soil sampling at the Kimabwe Prospect (Kabwima Project) confirms 5.5km x 1.6km

>100ppm Cu-in-soil anomaly with Cu values up to 485ppm Cu and in-pit results up to 359ppm

Cu. Additional pitting is underway and an aircore drilling program has been planned.

Infill soil sampling at the Mwako Prospect (Bulala Hills Project) has defined a semi-continuous

1km wide x 4.5km long >100ppm Cu-in-soil anomaly that remains open to the east. The

anomaly contains recent Cu-in-soil values up to 0.11% Cu associated with a 50m to 200m wide

shear zone containing a hematite breccia and a quartz porphyry intrusive displaying strong

argillic alteration. Reverse Circulation (RC) drilling to test the shear zone at depth is planned.

Renewal documents for all 5 Zambian prospecting licences have been submitted with

approvals without reduction for a further 2 years expected during July 2014.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Mwongo Project (99.9% CYS)

Results from the low level 4 acid digest, 48 element analysis for 1,625 wide spaced soil samples collected from within residual soil areas across the entire Mwongo Project in south-western Zambia have been received from ALS in Johannesburg. Evaluation of the soil data has identified coincident anomalous Cu-Fe-Ag-Na-U and low Ti associated with syenite intrusives confirming the potential for Kitumba style Iron Oxide Copper Gold (IOCG) mineralisation.

The elements common to both the 4 acid digest and in-house XRF analysis compare favourably and are within 15% error for Cu, As, Fe, Zn K, Mn, Rb, Th, Ti, and U. Immobile trace elements from the 4 acid digest analysis have been used to identify distinctive lithologies including a large syenite intrusive (Mulyongo Syenite) towards the centre of the licence. This syenite (previously considered a leucogranite) also shows highly elevated uranium levels in airborne radiometric data and soil sampling. Same scale airborne radiometric images for both the Mwongo and Kitumba projects are shown in figure 5. Immobile elements have been used to remove the background Cu effect inherent in different rock types and confirm 5 true Cu-in-soil anomalies. Contoured Sc/Cu ratios identifying the 5 main anomalies are also shown in figure 5. The Mulyongo Syenite forms the south-western end of a 9km long, up to 1.8km wide immobile element ratio confirmed Cu-in-soil anomaly with coincident elevated Cu-Ag-Na-U and low Ti, and forms the main exploration target for Cu mineralisation going forward.

Figure 5: Left: Mwongo Project immobile element (Cu/Sc ratio) soil anomaly contours and coloured soil sample locations, prospects and structures over airborne uranium image, Right: Kitumba Deposit discovery hole (red circle) over FALCON airborne uranium image.

Results from the Kasonkomona and Sicheku infill soil and trench sampling were disappointing, however rock chip sampling results included 0.55% Cu, 0.12% Cu, 0.12g/t Au and 0.1% Cu in malachite stained siltstone and ferruginous breccia at Kasonkomona, 0.15% Cu, 0.19% Cu, and 0.1g/t Au in malachite stained limonitic gossan at Mulyongo and 0.91g/t Au from a siliceous ironstone at Mwapula West (Fig. 5).

Geological mapping and infill soil sampling has been completed at Chitampira, and around the workings and trenches at the Mulyongo Prospect. The old Mulyongo trenches have also been channel sampled. All results are pending. A reverse circulation (RC) drill program is being proposed

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

to test for sulphide copper mineralisation at depth beneath the Mulyongo workings. Infill soil sampling is now focusing on the Mulyongo Syenite and the Kaporoso and Musontwa soil anomalies.

Kabwima Project (99.99% CYS)

XRF analysis of 270 infill soil samples and 193 pit samples has been completed within the Kimabwe Prospect 5.5km x 1.6km wide >100ppm Cu-in-soil anomaly soil (ex-Block G) within the Kabwima Project to the east of Solwezi in the north-western part of Zambia. The Kimabwe soil sampling is now at a 50m x 250m spacing throughout with 72% of recent infill soil samples returning XRF values greater than 100ppm Cu to a maximum of 485ppm Cu (Fig. 1).

Ten additional pits have been excavated into the eastern end of the Kimabwe anomaly. Bottom of pit geology is presented in Figure 2. Vertical channel samples collected every 50cm returned maximum in-pit copper results of 359ppm Cu and 346ppm Cu from pits KIPT007 and KIPT008 respectively. Additional pitting is underway and a first pass drill program consisting of 70 aircore holes has been designed to test the ENE-trending structure that cuts through the main part of the soil anomalism (Fig. 2). Additional infill and extension soil sampling is also planned for the other nine soil anomalies within Blocks A, B, E, H, and J, and regional wide spaced (1km x 1km) soil sampling is underway.

Figure 1: Kimabwe Prospect soil sampling XRF results and maximum down-pit copper results labelled and coloured by Cu

(ppm) over RTP TMI aeromagnetic image.

Kimabwe Prospect

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Figure 2: Kimabwe Prospect >100ppm Cu-in-soil contour (red), pit geology and proposed drilling over interpreted geology

Bulala Hills Project (99.99% CYS)

XRF analysis of 2063 infill soil samples from the Mwako Prospect has been completed within the Bulala Hills Project to the SW of Mumbwa in the south-western part of Zambia (Fig. 3). The infill sampling is now at a 50m x 50m spacing throughout with 107 soil samples returning XRF values greater than 200ppm Cu to a maximum of 1066ppm Cu. The >100ppm Cu-in-soil anomaly remains open to the east, is up to 1km wide, and is semi-continuous over 4.5km. Copper mineralisation appears to be associated with a steeply dipping NE-trending 50m to 200m wide shear zone containing a quartz porphyry intrusive displaying strong argillic alteration and a hematite breccia unit on its northern contact (Fig. 4).

A first pass drill program consisting of 10 reverse circulation (RC) holes has been designed to test the Mwako shear zone at depth beneath the best parts of the Cu-in-soil anomaly (Fig. 4). Additional infill soil sampling is planned for the eastern extension of the Mwako anomaly and also at the Ifumbwe anomaly just 3km along strike to the east of Mwako.

Wide spaced regional soil sampling (1km x 1km) over all residual soil areas across the project is continuing with 145 of the 1280 planned samples now collected.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Figure 3: Bulala Hills historic soil samples (coloured circles), rock chips (>0.1% Cu labelled in red), interpreted structures,

and Mwako Prospect >100ppm Cu-in-soil contour from recent infill soil sampling over grey scale RTP TMI aeromagnetic

image.

Figure 4: Mwako Prospect soil samples coloured and labelled by XRF Cu results (ppm), proposed drill hole locations over

interpreted geology.

Zambian Licence renewals

Renewal documents for all 5 Zambian prospecting licences were submitted in April 2014, 2 months ahead of the submission deadline. Follow-up meetings with the members of the Ministry of Mines Energy and Water Development Licence Renewal committee were conducted in May 2014. The meetings were positive with respect to Chrysalis meeting exploration expenditures and corporate and social responsibility commitments over the current 2 year period. The renewals are expected to be approved without reduction for a further 2 years during July 2014.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

For further information please contact:

Leigh Ryan Chief Executive Officer +61 427 093 043

Website: www.chrysalisresources.com.au Competent Person’s Statement The information in this report that relates to exploration results is based on information compiled by Mr Leigh Ryan, CEO employed by Chrysalis, who is a Member of the Australian Institute of Geoscientists (MAIG). Mr Ryan has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Ryan consents to the inclusion in the report of the matters based on information in the form and context in which it appears. Mr Ryan participates in the Company’s Employee Share Plan

JORC Code, 2012 Edition – Table 1

Section 1 Sampling Techniques and Data

Criteria JORC Code explanation Commentary

Sampling techniques

Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling.

Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.

Aspects of the determination of mineralisation that are Material to the Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information.

All samples referred to in this Public Report are soil samples or pit channel samples, obtained using an ‘industry standard’ sampling equipment and sampling practices.

Soil Samples:

Each site is located using a hand held GPS. The sample location is then adjusted when necessary in order to avoid tracks, alluvium, or other transported material. Metal picks and shovels are used to dig holes at varying depths down to a nominal B-Horizon. Approximately 2 to 3 kg of soil from the B-horizon only is collected in plastic bags and taken back to the base camp for drying and sieving to -2mm under controlled conditions.

Sampling was carried out using documented CYS sampling and QAQC procedures (detailed below).

Pit Samples:

Each site is located using a hand held GPS. Metal picks and shovels are then used to dig the pit which is approximately 1.5m square down to a recognisable saprock. Wooden ladders and rope ladders are used to enter and exit the pit. Buckets or sacks on the end of ropes are used to remove the excavated dirt. Once completed the pit is paint marked on a 50cm basis from the surface and geologically mapped. A continuous vertical channel sample is then chiselled into the pit wall using a geological pick. The sampling commences at the base of any transported alluvium with samples collected every 50cm. The pit wall material is collected into a steel tray and transferred into a numbered plastic sample bag. Each sample is then taken back to the base camp for drying under controlled conditions.

Sampling was carried out using documented CYS sampling and QAQC procedures (detailed below).

Drilling techniques

Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger,

Drill hole sampling or drilling results are not included in this announcement.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Criteria JORC Code explanation Commentary

Bangka, sonic, etc.) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc.).

Drill sample recovery

Method of recording and assessing core and chip sample recoveries and results assessed.

Measures taken to maximise sample recovery and ensure representative nature of the samples.

Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.

Drill hole sampling or drilling results are not included in this announcement.

Logging Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.

Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc.) photography.

The total length and percentage of the relevant intersections logged.

Soil Samples:

A Geologist or experienced field technician logs each soil sample, noting soil sample hole depth and width, slope and slope direction, vegetation, organic content, soil B-horizon, soil moisture, soil texture, soil colour, soil fragment rock types, and comments.

Pits:

A Geologist or experienced field technician maps each pit, noting regolith/rock type, colour, alteration, mineralisation, veining and comments. Any veins and or structures are measured and noted in the pit log.

Sub-sampling techniques and sample preparation

If core, whether cut or sawn and whether quarter, half or all core taken.

If non-core, whether riffled, tube sampled, rotary split, etc. and whether sampled wet or dry.

For all sample types, the nature, quality and appropriateness of the sample preparation technique.

Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples.

Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling.

Whether sample sizes are appropriate to the grain size of the material being sampled.

Soil Samples:

One commercial laboratory standard or blank laboratory standard, one field blank (barren marble from Lusaka Quarry with an average grade of 6ppm Cu) and one field duplicate is inserted into the soil sample series every 100 samples (i.e. 3% QAQC samples). Field duplicates are collected from the same depth within the same soil sample hole.

Pit Samples:

One field duplicate is included in every pit irrespective of total pit depth.

Statistical analysis of duplicate sample data for Cu in both soil and pit sampling shows a high level of repeatability and a lack of bias between the original and duplicate samples. The sample sizes and the sampling methodology are considered appropriate for the style of mineralisation, and the analysis value ranges for the primary elements.

CYS used commercially available reference materials, having a good range of values, and

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Criteria JORC Code explanation Commentary

were inserted regularly. Results highlight that sample assay values are accurate. Duplicate analysis for samples reveals that precision of samples is within acceptable limits

Quality of assay data and laboratory tests

The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total.

For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.

Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established.

Each dry “bulk” soil sample and each dry pit sample is analysed using a Niton hand held XRF instrument. Each sample is analysed for a minimum of 30 seconds, and each sample undergoes 5 such readings. An average of the 5 readings is used for exploration evaluation and reporting purposes.

The analysis is considered partial only.

Analysis is completed using either a Niton XL3t 955 Ultra Analyser, or a Niton XL3t GOLDD+ Series Analyser.

The instruments are calibrated using Niton calibration discs twice a day.

Selected soil samples were analysed at ALS laboratories in Johannesburg for low level Au (ALS method code Au-TL43) and 48 elements using ALS method code ME-ICP61.

Au-TL43 involves aqua regia digest of a 25g prepared sample with ICP-MS finish and a detection limit of 1ppb Au.

ME-ICP61 analysis involves a 0.25g prepared sample being digested with perchloric, nitric, hydrofluoric and hydrochloric acids. The residue is topped up with dilute hydrochloric acid and the resulting solution is analyzed by inductively coupled plasma-atomic emission spectrometry. Results are corrected for spectral inter-element interferences. Four acid digestions are able to dissolve most minerals; however, although the term “near-total” is used, depending on the sample matrix, not all elements are quantitatively extracted.

Rock chip samples are sent to SGS laboratory in Kalulushi for Cu and Au analysis using SGS method codes AAS42D and ARE155 respectively. AAS42D uses a 4 acid digest on a 1g prepared sample with an AAS finish and a 0.01ppm lower detection limit. ARE155 uses an aqua regia digest and organic extraction on a 50g prepared sample with an AAS finish and a 0.01ppm lower detection limit.

CYS use commercially available QAQC reference materials. A selected range of reference values are inserted at specific regular sample intervals. Results highlight that QAQC assay values are acceptably accurate. Duplicate analysis for samples reveals that precision of samples is within acceptable limits.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Criteria JORC Code explanation Commentary

Verification of sampling and assaying

The verification of significant intersections by either independent or alternative company personnel.

The use of twinned holes

Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.

Discuss any adjustment to assay data.

Soil and pit sample data is collected in the base camp by CYS qualified geologists and geo-technicians working under the supervision of a qualified geologist. The data is downloaded from the Niton instrument directly onto a laptop, and then opened in the Niton software for viewing and subsequent export into an Excel spreadsheet.

Field data is entered on paper log sheets and data entered into Excel spreadsheets at the base camp. Validation rules are in place to ensure no data entry errors occur.

Data is loaded into a Microsoft Access database by a consultant database administrator, and reviewed by the CYS CEO, who is a competent person.

No assay data adjustments have been made.

Location of data points

Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.

Specification of the grid system used.

Quality and adequacy of topographic control.

A hand-held GPS was used by CYS to locate soil sample and pit positions, with an expected 3 to 6m horizontal accuracy. The grid system used is Universal Transverse Mercator (UTM), Datum WGS 84, Zone 35 - Southern Hemisphere.

The vertical elevation of the pits was determined by placing the pit x, y coordinate on the digital terrain model (DTM) produced by NRG during the aeromagnetic flight information. The DTM was produced by subtracting the aircraft altitude from the aircrafts DGPS (Novatel 3151R) height. Results were referenced to the EGM96 Geoid.

The soil and pit sample location accuracy is considered appropriate for this stage of exploration.

Data spacing and distribution

Data spacing for reporting of Exploration Results.

Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied.

Whether sample compositing has been applied.

The soil sample spacing ranges between 500m x 500m for regional sampling and 50m x 50m for infill sampling.

Pits mentioned in this report are ~250m apart.

No Mineral Resource or Reserve is being reported for this drilling.

No data compositing has been applied.

Orientation of data in relation to geological structure

Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type

If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.

Soil sampling lines run N-S (True) at Kabwima and Bulala Hills, and E-W (True) at Mwongo which in all cases is up to 70 degrees to the strike of bedding and possible mineralisation.

No orientation based sampling bias has been identified in the data.

Sample security

The measures taken to ensure sample security.

Bulk samples are stored on site and guarded by 24 hour security guards.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Criteria JORC Code explanation Commentary

Audits or reviews

The results of any audits or reviews of sampling techniques and data.

An internal review of the sampling techniques and sample data considered both to be standard industry practice.

No external audit or review of the sampling techniques or sample data has been conducted to date.

Section 2 Reporting of Exploration Results

Criteria JORC Code explanation Commentary

Mineral tenement and land tenure status

Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.

The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.

Type - Large Prospecting Licence

Reference name – Kabwima North, Kabwima South, Mwongo, Bulala Hills

Reference number – 8194-HQ-LPL, 13404-HQ-LPL, 8198-HQ-LPL, 8199-HQ-LPL.

Location– NW Province and SW Province, Republic of Zambia.

Ownership – 99.99% Sedgwick Resources Limited, a wholly owned subsidiary of Chrysalis Resources (CYS)

Overriding royalties - none

The land is held under communal title, i.e. the local chief is the guardian. However, when it comes to change of land use, e.g. to mining, the national government, in consultation and agreement of the chief (representing the local inhabitants) make the final decision

No historical sites are known.

The central and eastern part of the Kabwima Project is covered by part of the Kalilele Forest Reserve, the eastern tip of the Bulala Hills licence is covered by the Luba Reserve and the southern tip of the Mwongo licence is covered by the Mumbwa Forest Reserve.

Environmental setting – savannah woodland of central Africa

Exploration done by other parties

Acknowledgment and appraisal of exploration by other parties.

RST conducted stream sediment sampling across the Kabwima Project area in the late 1960’s – early 1970’s.

No known previous exploration has been done on the Bulala Hills and Mwongo Projects.

Geology Deposit type, geological setting and style of mineralisation

Kabwima Project:

Deposit Type – Kansanshi Style Cu-Au+Ag mineralisation.

Geological setting – Folded and thrusted low grade mica schists, shale and limestone units (with variable dolomitisation) on the southern extremity of the Lufilian arc (i.e. the Katanga Super Group), of probable Lower Kundelungu Series age.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Criteria JORC Code explanation Commentary

Style of mineralisation – Lithologically and structurally controlled Cu-Au-Ag mineralisation within a tectonic breccia zone at or near the contact of a muscovite schist and a grey shale overlying variably dolomitised and metamorphosed limestone. The thickness of the mineralised zone varies along strike and down dip.

Mwongo and Bulala Hills Projects:

Deposit Type – Iron Oxide Copper Gold (IOCG).

Geological setting – Folded low grade metasandstone, siltstone, phyllite, schist, and graphitic shale units of the Katanga Super Group (probable Lower Kundelungu Series age) intruded by syn- to post-tectonic granitic intrusions associated with the Hook Granitoid Complex.

Style of mineralisation – massive haematite replacement breccia with Cu/Au mineralisation spatially associated with cross-cutting structures. Mineralisation is related to syn- to post-tectonic granitic intrusions (Hook Granitoid Complex) with associated regional iron-oxide alteration.

Drill hole Information

A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes:

o easting and northing of the drill hole collar

o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar

o dip and azimuth of the hole

o down hole length and interception depth

o hole length.

If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.

Cu-in-soil and maximum down-pit channel sample Cu results form the basis of the exploration results and are presented as figures within the body of the announcement.

Au and Cu in rock chip samples are stated and plotted in plan.

Other elements including Fe-Ag-Na-U-Ti and Sc/Cu ratios are mentioned in soil sampling result discussions but no actual values are stated.

Data aggregation methods

In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated.

Where aggregate intercepts incorporate short lengths of high grade results and

Each dry soil sample and each dry pit sample is analysed using a Niton hand held XRF instrument. Each sample is analysed for a minimum of 30 seconds, and each sample undergoes 5 such readings. An average of the 5 readings is used for exploration evaluation and reporting purposes.

For

per

sona

l use

onl

y

CHRYSALIS RESOURCES – ZAMBIAN EXPLORATION UPDATE

Criteria JORC Code explanation Commentary

longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail.

The assumptions used for any reporting of metal equivalent values should be clearly stated.

No averaging or aggregation of the ALS laboratory soil sample results or the SGS laboratory rock chip sampling results has been conducted.

No metal equivalent reporting is used or applied.

Relationship between mineralisation widths and intercept lengths

These relationships are particularly important in the reporting of Exploration Results.

If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported.

If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true width not known’).

Pits:

The Kabwima Block G Pits are excavated vertically into moderately NNE-dipping shale units such that the intercept angle is ~45 degrees.

Soils:

Soil sample results do not report mineralisation intercepts.

Diagrams Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.

Appropriate plans have been included in the text of this announcement. Cross sections of shallow pits are not warranted.

Balanced reporting

Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.

All Cu-in-soil and maximum down Cu pit sample results are displayed at a regional scale in the figures within this announcement.

Other substantive exploration data

Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.

There is only minor geological outcrop within the Kabwima and Mwongo Project areas. CYS flew a regional aeromagnetic and radiometric survey, which when interpreted shows regional lithological trends, cross-cutting structures and buried intrusives within the Kabwima, Bulala Hills and Mwongo Project areas. Aeromagnetic images are available for viewing in previous ASX announcements.

Further work The nature and scale of planned further work (e.g. tests for lateral extensions or depth extensions or large-scale step-out drilling).

Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.

First pass drilling is planned for the Kimabwe prospect (70 holes for ~4200m), Mwako prospect (10 holes for ~1500m) and Mulyongo prospect (4 holes for ~320m).

Additional soil sampling, pitting, and trenching is planned for the Kabwima, Bulala Hills and Mwongo Project areas.

For

per

sona

l use

onl

y