CHALICE MINING LIMITED 
By Appendix 5B Mining exploration entity quarterly report
Appendix 5B
Mining exploration entity quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10
Name of entity
CHALICE GOLD MINES LIMITED
Rule 5.3
ABN Quarter ended (“current quarter”)
47 116 648 956 30 JUNE 2011
Consolidated statement of cash flows
Cash flows related to operating activities
1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other - GST Net Operating Cash Flows+ See chapter 19 for defined terms.
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Mining exploration entity quarterly report
Cash flows related to financing activities
1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other Net financing cash flowsPayments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the related entities
Current quarter
$A'000 1.2 Aggregate amount of payments to the parties included in item 1.2 208 - 1.2 Aggregate amount of loans to the parties included in item 1.10 1.2 Explanation necessary for an understanding of the transactions Item 1.2 – Amounts paid to related parties include remuneration, directors’ fees, consulting fees and reimbursements of expenses to directors.Non-cash financing and investing activities
2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows
On 16 June 2011, the Company reached agreement with the Eritrean National Mining Corporation (ENAMCO) for ENAMCO’s acquisition of a 30% participating interest in Chalice’s Zara Gold Project in Eritrea. ENAMCO has agreed to pay to Chalice US$32 million for a 30% participating interest in the Zara Licences which will be represented by an interest in the operating company, Zara Mining SC. In addition to this amount, ENAMCO will pay Chalice approximately US$2 million (subject to audit), which represents a reimbursement to Chalice of ENAMCO’s pro-rata share of exploration costs expended to 31 March 2011on the Zara Licences which fall outside of the proposed Koka mining licence. Payment will be made within six months of the signing of a shareholders’ agreement, which is expected to be completed shortly. Following completion of the agreement, the Zara Project’s ownership structure will be Chalice (60% participating interest) and ENAMCO (30% participating interest, 10% free carried interest).+ See chapter 19 for defined terms.
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Appendix 5B Mining exploration entity quarterly report
2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest
NilFinancing facilities available
Add notes as necessary for an understanding of the position.
3.1 Loan facilities
3.2 Credit standby arrangementsEstimated cash outflows for next quarter
4.1 Exploration and evaluation
4.2 Development 4.3 Production 4.4 AdministrationReconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.
+ See chapter 19 for defined terms.
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Mining exploration entity quarterly report
Changes in interests in mining tenements
6.1 Interests in mining tenements relinquished, reduced or lapsed
6.2 Interests in mining tenements acquired or increasedIssued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights together with prices and dates.
7.5 +Convertible debt securities (description)
7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted+ See chapter 19 for defined terms.
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7.12 Unsecured notes
(totals only)Compliance statement
1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 5).
2 This statement does give a true and fair view of the matters disclosed.
Sign here: Date: 14 July 2011
Company Secretary
Print name: Richard Hacker
Notes
1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the
+ See chapter 19 for defined terms.
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Mining exploration entity quarterly report
change of percentage interest and conditions precedent in the list required for items
6.1 and 6.2.
3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.
4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of
Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.
5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.
== == == == ==
+ See chapter 19 for defined terms.
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