Tier-1 Scale Maiden Mineral Resource at Julimar

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ASX Announcement

9 November 2021

Tier-1 scale maiden Mineral Resource for Gonneville - 10Moz Pd+Pt+Au (3E), 530kt Ni, 330kt Cu and 53kt Co

Largest nickel sulphide discovery in over 20 years and largest PGE discovery in Australian history establishes foundation for world-class 'green metals' project

Highlights

• Maiden Indicated and Inferred, pit constrained, mineral resource estimate (Resource) defined for the Gonneville PGE-Ni-Cu-Co-Audeposit (Deposit), located on Chalice-ownedfarmland within the 100%-ownedJulimar Project, ~70km NE of Perth, WA:
• • 330Mt @ 0.94g/t 3E1, 0.16% Ni, 0.10% Cu, 0.016% Co (~0.58% NiEq2 or ~1.6g/t PdEq3);
  • Containing 10Moz 3E, 530kt Ni, 330kt Cu, 53kt Co (~1.9Mt NiEq or ~17Moz PdEq);
  • ~150Mt (45%) is within the Indicated category (55% within the Inferred category);
  • Resource is constrained within a pit shell and reported above a 0.4% NiEq cut-off grade (sulphide) and 0.9g/t Pd cut-off grade (oxide).
• The pit-constrained Resource includes a significant higher-gradesulphide component above a
  0.6% NiEq cut-off grade, starting from a depth of ~30m:
• • 74Mt @ 1.8g/t 3E, 0.22% Ni, 0.21% Cu, 0.021% Co (~1.0% NiEq or ~2.8g/t PdEq);
  • Containing 4.2Moz 3E, 160kt Ni, 150kt Cu, 15kt Co (~760kt NiEq or ~6.6Moz PdEq);
  • This higher-grade component affords the project significant optionality in development and could potentially materially enhance project economics in the initial years of operations.
• Gonneville is already the largest nickel sulphide discovery worldwide since 20004 (>20 years), and the largest PGE discovery in Australian history.
• The Deposit remains open to the north and at depth, demonstrating the potential for material growth with ongoing drilling.
• • High-grademineralisation begins at surface and has already been intersected ~60m below the limit of the Resource pit;
  • Wide-spacedextensional drilling is continuing down-plunge, with >1,000m of potential plunge extent yet to be fully tested on Chalice-owned farmland.
• The maiden Resource, which is interpreted to cover just ~7% of the 26km long Julimar Complex, confirms the world-classnature of the Julimar Project, and demonstrates the potential for the project to become a strategic, long-life'green metals' asset.

1 3E = Palladium (Pd) + Platinum (Pt) + Gold (Au), with an average in-situ ratio of ~4:1:0.04 (Pd:Pt:Au)

2 NiEq (Nickel Equivalent %) = Ni (%) + 0.37xPd (g/t) + 0.24xPt (g/t) + 0.25xAu (g/t) + 0.65xCu (%) + 3.24xCo (%)

3 PdEq (Palladium Equivalent g/t) = Pd (g/t) + 0.66xPt (g/t) + 0.67xAu (g/t) + 2.71xNi (%) + 1.76xCu (%) + 8.78xCo (%) 4 Source: S&P Global Market Intelligence, Capital IQ

Registered Office

ABN 47 116 648 956

Level 3, 46 Colin Street		[e-mail]
West Perth, Western Australia	T: [phone]	@chalicemining
PO Box 428, West Perth 6872		www.chalicemining.com	chalice-mining

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Overview

Chalice Mining Limited ("Chalice" or "the Company", ASX: CHN | OTCQB: CGMLF) is pleased to report its maiden Mineral Resource Estimate (Resource) for the Gonneville Deposit (Deposit), the first discovery at its 100%-ownedJulimar Nickel-Copper-PlatinumGroup Element (PGE) Project, located ~70km north-east of Perth in Western Australia.

The Company has defined a tier-1 scale, pit-constrained maiden Resource for Gonneville on Chalice- owned farmland, which includes a mix of oxide, transitional and sulphide mineralisation. The sulphide mineralisation is reported at two different cut-off grades in order to highlight the scale and development optionality the Deposit affords.

The robust nature of the Resource is demonstrated by the relatively flat grade-tonnage curves (Figure 2 and Figure 3), which highlight the significant quantity of sulphide mineralisation at higher cut-off grades. The significant high-grade component of the Resource provides excellent optionality for any future development, could potentially materially improve project economics in the initial years of operation and will be a key focus of the project Scoping Study, which is currently in progress. Note, the grade-tonnage curves for the Resource include material classified as Inferred, where data are insufficient to allow the geological grade and continuity to be confidently interpreted.

Drilling is continuing at the ~1.9km x 0.9km Deposit outside the maiden Resource, with assays pending for ~160 drill holes and five rigs continuing to test for extensions of high-grade mineralisation. Gonneville remains open at the Julimar State Forest boundary to the north, where approval to drill over a further ~10km of strike length is anticipated to be received shortly. The Deposit also remains open beyond a depth of ~630m.

The completion of the maiden Resource is a significant milestone for the Julimar Project and provides a strong foundation for the ongoing Scoping Study, which is scoping the initial mine development options at Gonneville, and is expected to be completed in Q2 2022.

Commenting on the maiden Resource, Chalice Managing Director & Chief Executive Officer, Alex Dorsch, said: "This is a major milestone for Chalice, coming just 18 months after our stunning first hole discovery at Julimar. Since then, we have completed more than 175,000m of diamond and RC drilling and now defined a genuine tier-1scale deposit of critical minerals, with exceptional growth potential.

"The Resource confirms that Gonneville is the largest nickel sulphide discovery globally in over two decades, and the largest PGE discovery in Australia's history - a remarkable achievement considering that this is the first discovery in what we consider to be an entirely new district, Julimar, within a new nickel-copper-PGE province, the West Yilgarn.

"Given its sheer scale, the attractive suite of six payable metals it contains and its premier location close to world-class infrastructure and services in Perth, Chalice clearly has the potential to become a leading global player in the green metals space.

"The high-grade sulphide component of the maiden Resource is very important to the project, as it provides a degree of optionality for mine development that is not often seen in mining projects of this nature. The vast majority of competitor projects worldwide are narrow, high- grade underground deposits, whereas high-grade mineralisation at Gonneville starts near surface, which could be a material factor when considering project economics in the initial years of operation.

"It is also important to emphasise that the current Resource covers just 7% of the Julimar Intrusive Complex, which has been interpreted to cover a strike length of more than 26km. We know that the deposit remains open along strike to the north, and we are very much looking forward to receiving the final clearances to commence our initial low impact drilling program in the Julimar State Forest.

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"In the meantime, we are continuing to test the extent of the high-grade sulphide zones with step-out drilling down-plunge, and we continue to see strong potential for underground development in the longer term. The Scoping Study for Gonneville is progressing well and is on track to be completed in the second quarter of next year.

"We are continuing to consult closely with local communities as well as governments at both the State and Federal level, to ensure we build trust and secure our social licence to operate. We consider it very important that the broader project stakeholders understand the project and the immense opportunity in front of us."

Commenting on the Resource and current exploration activities at Julimar, Chalice General Manager - Development, Bruce Kendall, said: "This is an exceptional result for a maiden Resource, with approximately 60% of the total sulphide tonnes in the top 250m already contained in the Indicated Resource category. This reflects the significant amount of infill drilling we have already undertaken at Gonneville and provides an outstanding base from which to complete the ongoing Scoping Study.

"The Resource pit shell is largely drill constrained at the southern end of the Deposit, where the highest grades occur, with few holes drilled thus far beneath the pit shell in this area. As our infill drilling has progressed it has shown that higher grade zones of mineralisation are more prevalent and more continuous than initial broad spaced drilling suggests. This is an important characteristic of the deposit which highlights the potential upside.

"Deep drilling targeting higher grade extensions and infilling drilling in the northern part of the Deposit, where most of the Inferred Resources are located, will be a focus in the coming months.

"Mineralisation is still open to the north within the Julimar State Forest, and we eagerly await the necessary approvals so that we can start drilling the Hartog target where soil sampling and moving loop EM has identified a number of compelling anomalies for drill testing.

"Despite the scale and significance of the maiden Gonneville Resource, we believe that the broader Julimar Project is still at a very early stage in its discovery history - and we are very excited about the discovery and growth opportunities within the extensive Julimar Complex."

Project location and history

The 100%-owned Julimar Nickel-Copper-PGE Project is located ~70km north-east of Perth in Western Australia. The greenfield Project was staked in early 2018 as part of Chalice's global search for high- potential nickel sulphide exploration opportunities.

Chalice interpreted the possible presence of an unrecognised, >26km long mafic-ultramafic layered intrusive complex at Julimar based on high-resolution regional magnetics (the Julimar Complex). An initial RC drill program commenced in Q1 2020 at the southern end of the Julimar Complex on private farmland (due to access constraints) and resulted in the discovery of high-gradePGE-nickel-copper-cobalt-gold sulphide mineralisation near surface. The first hole discovery at the project was named Gonneville.

The discovery of Gonneville and the Julimar Complex established the newly defined West Yilgarn Ni- Cu-PGE Province in Western Australia, an almost completely untested mineral province which is interpreted to extend for ~1,200km along the western margin of the Yilgarn Craton.

The Julimar Project is favourably located, with world-class road, rail, port and high-voltage power infrastructure nearby, plus access to a significant 'drive-in /drive-out' mining workforce in the Perth surrounds (Figure 1).

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Figure 1. Julimar Complex, Gonneville discovery, Project tenure (including licence applications) and nearby infrastructure.

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Maiden Gonneville Resource overview

Chalice engaged CSA Global Pty Ltd (CSA Global), an ERM Group company, to prepare a mineral resource estimate (Resource) for Gonneville. The Resource has been reported in accordance with the JORC Code (2012), is effective 9 November 2021, and is shown in full in Table 1.

CSA Global considers that data collection techniques are consistent with good industry practice and are suitable for use in the preparation of a Resource to be reported in accordance with the JORC Code. Available quality assurance and quality control (QA/QC) data supports the use of the input data provided by Chalice.

The Resource is considered to have reasonable prospects for eventual economic extraction (RPEEE) on the following basis:

• The deposit is located in a favourable mining jurisdiction, with no known impediments to land access or tenure status;
• The volume, orientation and grade of the Resource is amenable to mining extraction via traditional open-pit mining methods;
• Current geo-metallurgical recovery vs grade formulae based on available preliminary metallurgical test work and nominal metal concentrate offtake payment terms were used in a Whittle pit optimisation to generate the resource pit shell.

The Resource is reported within a pit shell using metal price assumptions of US$1,700/oz Pd, US$1,300/oz Pt, US$18,500/t Ni, US$9,000/t Cu, US$60,000/t Co and is reported above a 0.4% NiEq cutoff grade.

The metal prices used were obtained from long-term consensus analyst estimates5 (typically 2025 onwards), selecting a rounded figure within the P20-P30 range of the distribution (20-30% of values were above the selected figures). Chalice and CSA Global believe this is a reasonable approach, considering the expected mine life and considerations for reporting Mineral Resources in accordance with the JORC Code.

The block model continues beyond the limit of the Resource pit shell, however this material is not included in the maiden Resource. The Resource is reported according to domain (oxide, transitional or fresh) as well as geological confidence level (Indicated or Inferred) (Table 1).

5 Source: S&P Global Market Intelligence, Capital IQ

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