ASX Announcement

11 January 2017

NEW GOLD DISCOVERIES AND EXTENSIONS AT MOUNT BERGHAUS

ASX Code DEG

ABN 65 094 206 292

COMPANY DIRECTORS

Simon Lill

Executive Chairman

Davide Bosio

Non-executive Director

Steve Morris

Non-executive Director

Craig Nelmes

Company Secretary/CFO

CONTACT DETAILS

Principal & Registered Office Level 2, Suite 9

389 Oxford Street

Mt Hawthorn WA 6016

PO Box 281

Mt Hawthorn WA 6016 www.degreymining.com.au admin@degreymining.com.au

T +61 8 9381 4108

F +61 8 9381 6761

  • Significant new gold intersections outside of existing resource model - remains open.

  • Two new discoveries - North Lode and West Berghaus - provide confidence of a large mineralized system.

  • Resource update expected towards end of January.

Significant new results include: Mount Berghaus Resource Area 10m @ 3.03g/t Au from 16m

4m @ 7.75g/t Au from 62m 22m @ 1.31g/t Au from 104m 14m @ 2.58g/t Au from 122m North Lode 17m @ 2.08g/t Au from 32m 4m @ 4.33g/t Au from 104m 9m @ 1.22g/t Au from 37m 7m @ 1.52g/t Au from 69m West Berghaus 11m @ 0.97g/t Au from 0m 43m @ 0.55g/t Au from 79m 12m @ 0.65g/t Au from 0m

NB: downhole widths do not necessarily reflect true widths.

Andy Beckwith, Geology Manager, commented

"These new drill results are very encouraging, particularly when combined with earlier shallow drill intersections released in mid- December.

Clearly, this is an under-drilled and large gold system within the highly prospective Mallina Shear Zone.

Our Turner River Project continues to provide excellent opportunities for further resource growth."

Turner River - Unlocking Shareholder Value

De Grey Mining Ltd (ASX: DEG, "De Grey" "Company") is pleased to report the final results of the outstanding drill holes at the Mount Berghaus prospect, Turner River Project (Figure 1). The RC drilling program, comprising 64 holes for a total advance of 5536m, forms an integral part of the Company's strategy of targeting a combined 500,000oz resource at the Turner River Project in the coming six months.

Figure 1 Turner River Project location plan

Specifically, the Mount Berghaus drilling program aims to both upgrade and expand on the current 43,000 ounce gold resource (Resources Statement by De Grey Mining Limited as reported to the ASX on 23 June 2016). The drilling has focused on key infill drilling within the existing resource and immediate along strike extensions, as well as testing newly defined outcropping gold bearing quartz veins and other priority targets.

Initial drilling results for the first 21 holes of the 64 hole program were reported in an ASX release on 16 December 2016, with significant results from the Mount Berghaus Resource Area and extensions including:

12m @ 11.36g/t Au from 5m 31m @ 2.07g/t Au from 8m 12m @ 2.21g/t Au from 51m 3m @ 5.51g/t Au from 64m 4m @ 7.95g/t Au from 28m

This report provides final 1 metre re-split results for earlier holes in Table 2 and final 1m re-splits the remaining 43 drill holes in Table 3.

Drilling Results

The overall drilling programme has been highly successful in defining:

  • Infill mineralisation within the Mount Berghaus Resource Area

  • Immediate along strike extensions to mineralisation outside the Mount Berghaus Resource Area

  • Multiple quartz lodes

  • Significant new mineralisation at the North Lode and West Berghaus Prospects

  • All three mineralised areas remain open along strike and at depth.

  1. Existing Mount Berghaus Resource Area

    At Mount Berghaus multiple lodes of quartz veining have been defined with associated significant gold mineralisation. Mineralisation remains open both along strike and at depth along many of the lodes. Drilling has also intersected a new lode and extensions to the existing lodes. Wireframing and geological modelling of the mineralised lodes is currently underway and an updated resource is planned to commence towards the end of January. Figures 2 and 3 provides a summary of drilling intersections and hole locations at Mount Berghaus, North Lode and West Berghaus.

    Mount Berghaus Resource Area - Significant new drill results:

    10m @ 3.03g/t Au from 16m in BGRC168 (including 2m @ 9.7g/t Au from 24m) 4m @ 7.75g/t Au from 62m in BGRC147 (including 1m @ 29.2g/t Au from 63m) 22m @ 1.31g/t Au from 104m in BGRC148 (including 1m @ 7.44g/t Au from 114m, 1m @ 4.05g/t Au from 121m and 2m @ 3.85g/t Au from 124m) 14m @ 2.58g/t Au from 122m in BGRC149 (including 1m @ 31.5g/t Au from 129m) 12m @ 1.34g/t Au from 63m in BGRC158 22m @ 0.93g/t Au from 45m in BGRC171

  2. New Discoveries

The North Lode is a new discovery approximately 300m to the north of the Mount Berghaus Resource Area and shows a number of significant shallow gold intersections from the limited 6 RC drill holes completed to date. This mineralisation is associated with quartz veining along the margins of a series of narrow porphyry intrusions within the sediment package. This mineralisation remains open to the east and at depth with wide spaced earlier RAB drilling suggesting further extension may be possible, particularly to the east. Further drilling is required to extend and fully understand the potential in this new zone.

Figure 2 Mount Berghaus regional drill collar plan

y

New Discover

Area

est Berghaus Prospect

North Lode

New Discovery

shown in Figure 3

New Extensions

W

500m

RC drill collars - just completed

Current resource areas

RC drill collars - historic

DD drill collars - historic

Page | 4

De Grey Mining Limited published this content on 11 January 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 17 January 2017 02:30:03 UTC.

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