Eritrea

Chalice Gold Mines Limited (ASX: CHN) advises that it has informed Newmont Mining Corporation that Chalice will not proceed with a planned regional joint venture agreement in Eritrea.

The proposed JV, which was outlined in an ASX announcement on July 23, 2010, remained subject to formal documentation, which has not been completed.

Following the current fully underwritten rights issue Chalice will have cash of ~$16 million and therefore the Board has decided it would be in shareholder’s best interests if Chalice explored the highly prospective tenements in its own right. The tenements are currently under application.

Under a joint venture agreement, Newmont would have funded an initial $1-million reconnaissance exploration programme, after which both parties would have selected areas to be retained in the venture.

Newmont would have been the majority shareholder of the new joint venture with 75% ownership and Chalice ownership would have fallen to 25%.

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5. Chalice Acquires Full Ownership of Zara Gold Project, Eritrea
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7. Chalice Gold Mines Entitled to A$5 Million Following Merger with Sub-Sahara Resources
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