Chalice Gold Mines Limited ("Chalice" or "the Company") announced encouraging new reconnaissance air-core (AC) drilling results from the Karri Target at its 100%-owned Pyramid Hill Gold Project, located in the Bendigo Region of Victoria. The Karri Target is located 65km north-west of Bendigo, under 50-85m of Murray Basin cover. The new results, which follow the initial discovery of the gold trend under cover at the Karri Target in late 2019, have significantly expanded the footprint and the robustness of the Karri Target. The Company also announced a significant ramp-up in activities at the Project, with the impending commencement of its maiden diamond drill program, along with a trial 2D seismic survey. The Company's 25,000m Phase 2 reconnaissance AC drill program continues at the Karri, Ironbark North and Ironbark Targets in the Muckleford Area. The program is designed to further refine the secondary gold and pathfinder dispersion zones defined in shallow, wide-spaced vertical AC drilling in Phase 1. These dispersion zones in the weathered top of basement can be used to vector towards primary gold mineralisation in future deeper, tighter spaced drill holes. A total of 99 Phase 2 AC drill holes for 11,000m have now been completed at the Karri Target. Encouraging new assays have now been received for 3,275m of this program, following on from the initial 4,700m released in December. All AC holes were drilled vertically to AC blade refusal, which typically occurs at the base of the weathered Castlemaine Group basement. The Castlemaine Group is the target basement rock which hosts >60Moz of high-grade historical gold production from the outcropping areas of the Bendigo Zone to the south of the Project. Drilling tested the projected north-south strike of the main gold trend a further 1km south of the previous drilling, with results showing the anomalous gold zone now extends over 3km in strike length and is up to 500m wide. Encouragingly, in-fill drilling has demonstrated that the zones are likely contiguous, and all identified zones remain open along strike to the north and south. The in-fill and step-out drilling on 500m-spaced lines has returned anomalous gold values with the better gold intersections associated with zones of quartz veining with accompanying sulphides (pyrite ± arsenopyrite). The gold zones are within an interbedded sequence of weathered sandstones and shales that have been variably altered (silicified) and show strongly elevated levels of arsenic (up to 220ppm), an important gold pathfinder in the region. The highly anomalous gold grades intersected are considered significant for this early stage of wide- spaced, vertical reconnaissance drilling into the weathered top of basement only. Future work ­ drilling: 20,500m of the 25,000m Phase 2 AC program has now been completed in the Muckleford Area, with assays currently pending for 3,000m of drilling at the Karri Target. Further reconnaissance AC drilling is currently underway at the Ironbark North Target, after which further step-out and in-fill AC drilling will be completed at the Karri Target on a 500m x 50m grid. An initial diamond drill program will commence in mid-January in parallel to the ongoing Phase 2 AC drill program. One 300m deep hole is planned at each of the Karri, Ironbark North and Ironbark Targets to provide an early understanding of the local geology and structural controls. This initial information would be used to determine the optimal drilling strategy for the next phases of exploration. Based on real-time results from these initial diamond holes, the program may be expanded. It is expected that further reconnaissance diamond drilling would follow these initial holes to systematically test each target at depth. Future work ­ 2D seismic: An initial 2D high-resolution seismic survey will be completed in February 2020. This initial trial survey has been designed to determine if the technique can resolve stratigraphic horizons, which could then be used to model the regional and prospect-scale geological setting and highlight any areas of enhanced structural complexity. The survey has been designed to image the relatively shallow part of the underlying Castlemaine Group sediments and associated structures to a depth of 2km. If successful, the technique may prove valuable in guiding and optimising future deeper drilling. The 15km east-west line will extend from the western margin of the Karri Target to the eastern boundary of the Muckleford Area. As such, the line will cross the interpreted positions of the regional-scale Campbelltown, Muckleford and Sebastian Faults beneath younger Murray Basin cover. These Faults are important controls of mineralisation in the region. Geoscience Australia completed a crustal-scale 2D seismic transect in Victoria in 2006 which successfully resolved the positions of the regional scale faults across the southern part of the Company's Project. By utilising a higher resolution set-up, the Company expects that the 2D seismic technique will be effective in modelling shallow structural features in the Castlemaine Group.