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ASX Announcement 22 December 2011 Further High Grade Gold Hits Enhance Zara Project New results confirm that mineralisation at Koka South extends to depth and remains open

Chalice Gold Mines (ASX: CHN; TSX: CXN) and Zara Mining Share Company (Chalice 60%, ENAMCO 40%) are pleased to advise that new drilling results have confirmed extensions to the high-grade mineralisation at the emerging Koka South discovery, located immediately south of its flagship Koka Gold Deposit, part of the Zara Gold Project in northern Eritrea.

Results have now been received for a further two holes that were drilled to the south of previous drilling, with both holes returning high-grade intersections, including: