European Goldfields Limited results for Q1 2009



    
                        STRONG RECOVERY IN GOLD SALES
                  CERTEJ BASIC ENGINEERING CONTRACT AWARDED
    

    WHITEHORSE, YT, May 12 /CNW/ - European Goldfields Limited (AIM: EGU /
TSX: EGU) ("European Goldfields" or the "Company") today reports its results
for the quarter ended 31 March 2009.

    
    Financial highlights:

    -   Strong gold sales - up by 45% on Q4 2008
    -   Total sales of $11 million reflecting lower base metal prices and
        mining performance
    -   Working capital of $176 million
    -   US$10 million invested in future projects

    Operational highlights:

    -   Stratoni: Reserve increase of 16%. Excellent progress in mine and
        capital development
    -   Skouries: The Outotec Final Basic Engineering Package received and
        some equipment items delivered to Greece
    -   Olympias: Strong recovery in Gold sales
    -   Certej: Permitting process advances with public hearing dates set for
        May 2009
    

    Commenting on the results, David Reading, Chief Executive Officer of
European Goldfields, said: "The Stratoni mine managed to pull out a reasonable
performance despite challenging conditions. I am pleased to report that our
gold sales are now back on track. The company continues to invest in its
future gold projects and engineering works continue unabated. Permitting
procedures in Greece and Romania are making significant progress and we expect
positive results in the near future."

    Conference Call & Webcast - European Goldfields will host a conference
call on Tuesday 12 May 2009 at 10:00 a.m. ET / 3:00 pm (London, UK time) to
update investors and analysts on its results.
    Participants may join the call by dialling one of the three following
numbers, approximately 10 minutes before the start of the call.

    
    From North America: (toll free) 1 866 850 2201
    From the UK, Austria, Belgium, Denmark, France, Germany, Ireland, Italy,
    Netherlands, Norway, Sweden & Switzerland: +44 (0)20 7138 0841 or (toll
    free from the UK) 0800 032 3808
    Participant pass code: 1421823
    

    A live audio webcast of the call and a replay (available from 4:00pm 
London UK time) will be available on:
    http://mediaserve.buchanan.uk.com/2009/eg120509/registration.asp

    
                           SELECTED FINANCIAL DATA

                                                   --------------------------
                                                      Quarter ended 31 March
                                                   --------------------------
    (in thousands of US dollars,                           2009         2008
    except per share amounts)                                 $            $
    -------------------------------------------------------------------------
    Statement of profit and loss
    Sales                                                10,742       12,708
    Gross profit                                           (342)       4,849
    Profit/(loss) before income tax                      (3,979)       4,263
    Income taxes                                            540         (621)
    Profit/(loss) after income tax                       (3,439)       3,642
    Non-controlling interest                                183         (233)
    Profit/(loss) for the period                         (3,256)       3,409
    Earnings/(loss) per share                             (0.02)        0.02
    -------------------------------------------------------------------------


                                                   --------------------------
                                                       31 March  31 December
                                                           2009         2008
    (in thousands of US dollars)                              $            $
    -------------------------------------------------------------------------
    Balance sheet
    Working capital                                     176,319      192,675
    Total assets                                        757,206      766,095
    -------------------------------------------------------------------------
    

    European Goldfields' unaudited consolidated financial statements and
management's discussion and analysis for the three month periods ended 31
March 2009 and 2008 are filed on SEDAR at www.sedar.com.
    Revenues fell as a direct result of the fall in zinc and lead prices
between Q1 2009 and Q1 2008, particularly in the second half of 2008. In
addition, poor ground conditions in Q1 2009 hampered production activities
resulting in lower base metal production levels. This was offset by a strong
performance from gold concentrate sales. The Company's lead hedging programme
will remain in place until the end of 2009 and generated income of US$2.4
million for the quarter. Working capital declined as the Company continued its
capital expenditure programmes at its operating mine and development projects,
but the Company's balance sheet remains strong.

    
                         STRATONI OPERATIONS (GREECE)

    Highlights:

    -   Lower production due to poor mining conditions
    -   Internal mine development well ahead of budget
    -   Major mine infrastructure nears completion
    -   Water management measures control exceptional rainfall event
    -   Reserve increase of 16%
    

    Production

    The Stratoni mine consists of a lead-zinc-silver deposit and lies
approximately four km from the coastal town of Stratoni in northern Greece.
The Company's 95%-owned subsidiary Hellas Gold mined a total of 56,892 wet
tonnes in Q1 2009 (Q1 2008 - 58,208). Hellas Gold completed 7 shipments in Q1
2009 (Q1 2008 - 4), five shipments of zinc and two of lead/silver. Sales from
Stratoni were as follows:

    
                                                        Q1 2009      Q1 2008
    Production
    Ore mined (wet tonnes)                               56,892       58,208

    Sales
    Zinc concentrate (tonnes)                            10,306        8,371
    - Containing payable: Zinc (tonnes)(*)                4,152        3,454
    Lead concentrate (tonnes)                             3,762        1,872
    - Containing payable: Lead (tonnes)(*)                2,347        1,188
                          Silver (oz)(*)                183,504       95,582

    Inventory (end of period)
    Ore mined (wet tonnes)                                4,010        2,816
    Zinc concentrate (tonnes)                               602        2,745
    Lead/silver concentrate (tonnes)                      1,393        2,213

    (*) Net of smelter payable deductions
    

    Mining production, year to date, is under budget due to poor mining
conditions delaying the commencement of the more productive secondary mining
and forcing operations into lower grade areas. Q2 plans have been redrawn and
an H2 revision is in progress emphasising production from higher grade areas
to maintain metal targets for 2009.
    The large dimension, more productive lower level stopes have been
successfully backfilled for the first time and secondary mining has commenced
which will improve productivity. These are also higher grade areas of the
operation.
    Internal development is 213 metres against a budget of 140 metres (52%
above budget) and this work will enhance production face availability later in
the year.
    The 360 level Upper Adit is 78% finished. It is planned to complete by
mid June and be equipped and fully operational during July. The new adit will
facilitate improved ventilation, access and backfill to the upper levels of
the mine, where the majority of mine life extension is expected. With the
completion of the 360 adit the mine will have completed all its major
infrastructure upgrades within a three year programme and no further major
capital spend is anticipated.

    Process plant performance

    Zinc and lead metal recoveries are being maintained on budget at a
consistent 92% and silver at 87%. The plant continues to run efficiently and
planned maintenance was carried out on schedule, which is providing high
equipment availabilities.

    Water management measures control exceptional rainfall event

    Excessive rainfall was experienced during the Quarter; approximately 25%
of the average annual precipitation occurred within a thirty six hour period.
The new water retreatment measures and the upgraded water retreatment
facilities successfully managed this situation. Stratoni mine personnel are
commended for their diligence in controlling this issue.

    Reserves

    Exploration of the western extensions and the lower portion of the mine
has increased the reserve base by some 16%, effectively replenishing 2008
production. Proven and probable reserves now stand at 2.3 million tonnes,
which will support a further six years of mine life. The year on year
expansion of reserves has taken the life of the mine to ten years from
commencement of mining by the company in 2005.

    
    -------------------------------------------------------------------------
    Reserve
     Category    '000t   Ag g/t   Ag Moz     Pb %   Pb '000t   Zn %  Zn '000t
    -------------------------------------------------------------------------
    Proven       2,120      185     12.6      7.1      150      9.9      209
    -------------------------------------------------------------------------
    Probable       190      216      1.3      8.6       16      9.3       18
    -------------------------------------------------------------------------
    Total        2,310      188     13.9      7.2      166      9.8      227
    -------------------------------------------------------------------------
    

    Stratoni exploration

    Exploration continues with drilling to the west and southwest of the
currently defined orebody and it is expected that the Company will continue to
more than replenish the reserves mined each year.

    
                          SKOURIES PROJECT (GREECE)

    Highlights:

    -   Outotec final Basic Engineering Package received
    -   Fabrication and delivery of long lead process equipment continues
    

    The Company's Skouries gold-copper project is located 35 km by road from
the Stratoni port in northern Greece. Skouries is situated on a high plateau
with no habitation in the immediate vicinity. The project is currently at the
development stage. Skouries is a typical gold-copper porphyry deposit that
forms a near-vertical pipe. The project has reserves of 3.9 million ounces
gold and 800Kt copper. The orebody will be extracted by open pit and
underground mining methods. The revenue stream will be through production of
Gold doré from gravity concentration as well as the sale of Copper-Gold
concentrates.

    
    Outotec delivers BE package - Fabrication and delivery of equipment
    continues
    

    Hellas Gold signed a contract for (euro)36m with Outotec Minerals OY
("Outotec") for the supply of a large technology and services package for
Skouries. Outotec has delivered the Basic Engineering package to Hellas Gold
and are now progressing the Detailed Engineering phase for the process control
of the plant. Outotec has also submitted an offer for the Gravity Gold section
of the Concentrator for consideration.
    Fabrication of the mills is well advanced and some equipment items have
been delivered to Greece. The SAG mill shells, gear boxes, liners and motors
are ready for shipment and the remaining components are on schedule for ex
works delivery in the third quarter of 2009. The manufacturing of the regrind
mill, flotation cell mechanisms and the paste thickeners internals and bases
are progressing well. The offers for fabrication of the floatation cell tanks
in Greece have been received.

    Continued progress on engineering

    Orders for the long lead items outside of Outotec's scope are being
finalised by the Skouries project engineer ENOIA and include the Open Pit
primary crusher, pebble crushers, transformers and switch gear. ENOIA have
optimised the overall project layout, subject to final confirmatory
geotechnical investigations and are coordinating project activities both
within and outside of Outotec's scope, which includes design and procurement.
This work is being managed by a team consisting of both Hellas Gold and
European Goldfields personnel.
    The Greek civil engineering company, MHXME S.A, has been appointed to
carry out the civil design of the Skouries Project. Kion Architects of Athens
have been appointed to provide the architectural designs. Greek geotechnical
consultants Omicron Kappa have completed a report for the excavation and
foundation requirements of the process plant and the detailed design of the
open pit. They have also submitted their engineering work for the roads
network, which is being reviewed by Hellas Gold. Final detailed geotechnical
work has now commenced to finalise infrastructure design prior to
construction.
    ENOIA is expected to complete all the basic engineering for the Skouries
project by the end of Q2, at which point the Company will update its capital
expenditure estimate for the project.

    
                          OLYMPIAS PROJECT (GREECE)

    Highlights:

    -   Sale of gold concentrates up by 45% over Q4 2008
    

    The Company's Olympias project consists of a polymetallic (gold, lead,
zinc and silver) deposit located 8 km north of the Stratoni mine. At present
Hellas Gold is selling gold concentrates from the existing stockpile on the
property and is pursuing applications for the relevant permits to resume
mining. Hellas Gold plans to resume underground mining operations at Olympias
after the necessary permits are awarded.

    Continued sales of gold concentrates

    The Olympias project benefits from an existing stockpile of gold-bearing
pyrite concentrates which represented, at 1st January 2009, a reserve of
approximately 101,000 tonnes grading 23.5 g/t gold (containing approximately
75,000 oz of gold), in addition to tailings containing 238,000 oz of gold and
substantial underground reserves of gold, lead, zinc and silver.
    Hellas Gold completed 18 shipments of Olympias concentrates in Q1 2009
(Q1 2008 - 3). This translates into 26,832 tonnes of pyrite concentrates sold.
Sales of pyrite concentrates were as follows:

    
                                                        Q1 2009      Q1 2008
    Sales
    Gold concentrate (dry tonnes)                        26,832        9,778
    

    The disruptions caused by industrial action at the port of Thessaloniki,
which restricted the availability of containers for use in concentrate
shipments was resolved in January 2009 due to the Company's successful
sourcing of containers and a normalisation of industrial relations at the
port.
    In addition to the stockpile of gold concentrates, Hellas Gold plans to
process 2.4Mt of stockpiled tailings arising from the previous operations at
Olympias. This will produce approximately 350,000 tonnes of concentrates
(containing 238,000 oz of gold), and resume underground mining operations at
Olympias, producing more gold bearing pyrite concentrates for sale to existing
and new off-take purchasers.
    Olympias benefits from extensive mining and plant infrastructure already
in place, including a concentrator plant, a shaft down to a depth of 400
metres below surface and a port facility nearby at Stratoni.
    The Olympias project is expected to be self-sustaining over the initial
phases with the sale of concentrates and the high recoveries for the on-site
gold processing considered promising for the latter phase.

    Submission of EIS for re-treatment of tailings

    Mine schedules, plant refurbishment plans and cost studies for the second
phase of the Olympias project are approaching completion. In Q2 2008 the
company submitted an Environmental Impact Study ("EIS") to allow the early
processing of existing tailings, which will produce additional gold
concentrate and allow the rehabilitation of a significant area of the Olympias
valley. The Company has worked closely with the Ministry of Environment and
anticipates approval of the EIS in the near future. It is planned that this
re-processing will commence in parallel with refurbishment of the plant lines
for run of mine production and the necessary underground development to
recommence production in Phase Two. The Company has received expressions of
interest for the detailed design phase from Greek engineering companies, which
are currently being evaluated pending the outcome of the Olympias EIS
application.

    
                 PERMITTING PROCESS - SKOURIES AND OLYMPIAS
    

    The Company continues to receive the support of the Greek Ministry of
Development for its Business Plan and its preliminary environmental impact
study ("PEIS"). The business plan focuses on a phased approach to the
development of the Skouries gold-copper porphyry deposit and the Olympias
gold-lead-zinc-silver deposit. The principal revenue stream in the early
phases will be through the sale of concentrates. The Company's current plan is
to develop Olympias in two phases. The Company will refurbish the underground
mine in the early stage and in the final phase will construct a new gold
processing facility in the brownfield Stratoni area. Skouries will initially
be mined as a low strip open pit operation, followed by highly productive
underground mining.
    Further to site visits in late 2008 by specialists from the Ministry of
Culture and subsequent discussions, the Company now anticipates the approval
of the PEIS within Q2 2009.
    Approval of the PEIS by the Ministry of Environment will be expressed as
a Project Pre-Approval from the Greek State with an invitation to the Company
to submit its final EIS to allow public consultation. On approval of the EIS,
the environmental permits for Skouries and Olympias will be issued.
    The Company will then submit to the Greek government a final technical
report on the Skouries and Olympias projects, which will restate the
principles of the business plan and take into account any conditions detailed
in the environmental permit. The mining permits are expected to be issued on
approval of the technical report by the Greek government.

    
                            EXPLORATION IN GREECE
    

    Airborne geophysical surveys have revealed four new zones of conductive
rocks with electromagnetic ("EM") signatures typical for massive sulphides,
such as the known mineralisation at Stratoni, Olympias and Piavitsa. The new
zones are distinct from any known mineralisation and represent some 20
kilometres of potential strike, which represents approximately 10 times the
strike of known massive sulphide reserves in the licence area. Each anomalous
area will now be investigated in the field with mapping, geochemistry and
possibly follow-up ground geophysics in order to define future drill targets.
    The EM survey had already successfully confirmed an anomaly extending
eight kilometres of strike at the Piavitsa massive sulphide target. Two
kilometres of this strike length have massive sulphide drill intercepts which
correspond exactly with the EM anomaly. A phased drilling programme is planned
to commence in 2009 with the first phase drilled from existing access roads
starting in Q2 and aimed at confirming mineralisation continuity and depth
extent. Follow-on phases aimed at resource definition will require new access
roads and therefore an EIS has been submitted to the local authorities. The
EIS is expected to be approved by the end of the year.
    In addition, the magnetic component of the survey has already identified
a 17 kilometre by six kilometre belt of porphyry intrusives over which a three
dimensional model has been completed defining two other major targets.
Follow-up reconnaissance mapping on the ground has confirmed the presence of
porphyry style mineralisation and drill sites have been selected for test
drilling. This drilling will be carried out in parallel with the second phase
of drilling at Piavitsa since it will also require new access roads.

    
                           CERTEJ PROJECT (ROMANIA)

    Highlights:

    -   Basic Engineering for process plant awarded
    -   Permitting process continues to advance, public hearings set for May
        2009
    

    The Company's Certej gold-silver project is located 12km from the town of
Deva in the "Golden Quadrilateral" area of the Apuseni Mountains of
Transylvania in Western Romania. Certej has recent previous mining activity
and boasts excellent infrastructure. The project is currently at the
development stage. Certej is a typical epithermal gold-silver deposit. The
project has reserves of 2.41 million ounces gold and 11.7 million ounces
silver. The orebody will be mined by open pit methods. The gold and silver
will be extracted from a pyrite flotation concentrate using the Albion Leach
Process and conventional Carbon in Leach ("CIL") of the leach residue. The
revenue stream will be through the production and marketing of gold-silver
doré.

    Basic Engineering Contract awarded

    The Basic Engineering ("BE") contract for the Certej project process
plant and associated infrastructure was awarded to Aker Solutions Engineering
& Construction. Work started in February 2009 and the scheduled completion
date is August. The BE covers the entire process plant engineering
encompassing the three main areas of mineral processing, the concentrator
area, the Albion section and gold-silver doré production by CIL. Xstrata
Technology, who are the owners of the Albion Process, are part of the BE team
for the Albion section of the plant. The Romanian contractor Cepromin is also
an important contributor to the work as it progresses through to detailed
engineering and will ensure the submissions comply with Romanian procedures
for issuing the Construction Permit and beyond.
    Detailed technical and economic studies on Certej culminated with an
updated Definitive Feasibility Study in Q1. This updated study incorporated a
new tailings facility site within the Certej valley and additional reserves
defined from in-pit lower-grade material and existing dumps.

    
    The key project indices are summarised in the Table below:
    -------------------------------------------------------------------------
    Reserves
    -------------------------------------------------------------------------
    Tonnes                   Years 1-11.5   32.8Mt    2.0g/t Au, 11.4 g/t Ag
    -------------------------------------------------------------------------
                            Years 11.5-16   14.1Mt  0.64 g/t Au, 11.7 g/t Ag
    -------------------------------------------------------------------------
    Strip Ratio              Years 1-11.5                 3.1
    -------------------------------------------------------------------------
    Annual Throughput                                     3Mt
    -------------------------------------------------------------------------
    Overall Gold Recovery                                 81%
    -------------------------------------------------------------------------
    Overall Silver Recovery                               74%
    -------------------------------------------------------------------------
    Life of Mine                                       16 years
    -------------------------------------------------------------------------
    Production
    -------------------------------------------------------------------------
                                 Years 1-3           Years 1-11.5
    -------------------------------------------------------------------------
    Average Gold Production,
     oz pa                         172,000              155,000
    -------------------------------------------------------------------------
    Average Silver Production,
     oz pa                         720,000              816,000
    -------------------------------------------------------------------------
    Costs
    -------------------------------------------------------------------------
                            (euro) million          (euro) million
    -------------------------------------------------------------------------
    Capital                        Initial            Sustaining
    -------------------------------------------------------------------------
                                     133.4               47.4
    -------------------------------------------------------------------------
    Cash Costs(*)                          US$370/oz Au(*)
    -------------------------------------------------------------------------
    (*) Net of silver by-product credits at $7.50/oz
    -------------------------------------------------------------------------
    Financial
    -------------------------------------------------------------------------
    Post tax IRR                                         21.3%
    -------------------------------------------------------------------------
    

    The project will involve the mining and processing of 3.0 million tonnes
of ore per annum over an open pit life of 11 and a half years. The pit is
expected to yield approximately 160,000 oz of gold and 820,000 oz of silver
per year in doré, reflecting an average total process recovery of 81% for gold
and approximately 75% for silver. Thereafter, the plant will be fed for a
further five years at the same throughput rate by material previously
stockpiled from the open pit or historic dumps which has been defined and is
Canadian NI 43-101 compliant.
    The metallurgical process involves the production of a flotation
concentrate followed by the extraction of gold and silver into doré on site,
incorporating an oxidation stage using the Albion Process. The Albion Process
is a combination of ultra-fine grinding of concentrates and oxidative leaching
at atmospheric pressure. The liberated gold and silver is then recovered as
doré by the conventional CIL process.
    The residues from the flotation and gold plants will be disposed of in
two separate but adjoining tailings management facilities (TMFs), which are
ideally located and designed for this project. The EIS confirms that the
Certej project and its TMFs will have a negligible impact on the local water
streams, flora and fauna. Golder Associates have completed the design and cost
study for the TMFs. The location of the two TMFs is in the same valley as the
mine and plant, which results in only a single water catchment area and
principality for the entire Certej project.

    Permitting process continues to advance

    The Certej project has already received all the technical mining
approvals and permits required for the operation of mining activities: in
September 2008, the Romanian National Agency for Mineral Resources ("NAMR")
approved the Technical Feasibility Study ("TFS") for the project, as required
under Romanian legislation, and also confirmed the official approval and
registration of the project's resources and reserves. This completed all the
mining approvals required for the project from NAMR and was a very significant
step forward in the development of the project, as it effectively updates the
mining permit and allows the TFS reserve to be mined.
    The Company recently updated the Certej Environmental Impact Study
("EIS"), incorporating the improved location of the TMFs in the same water
catchment area as the rest of the mine infrastructure. This was submitted to
the Romanian environmental authorities in Timisoara and has been incorporated
into both the EIS and Zonal Urbanisation Plan ("PUZ") processes. The PUZ
process is almost complete: the public notice period has already been
concluded without any adverse comments and the dates for public meetings with
the affected local communities have been agreed. A positive outcome of this
process is expected in Q2 and represents a significant step forward in the
environmental permitting process. Following the approval of the PUZ, the EIS
will also then be subject to the last requirement for public consultation
prior to the issuance of the environmental permit. These are the final
approvals required for the construction and operation of the plant, the
tailings design and other related infrastructure.

    
                           EXPLORATION IN ROMANIA

    -   Exploration has commenced on the new licences
    

    In late 2008 and early 2009, the Company has acquired four new
prospecting licences totalling some 466 square kilometres. The licences cover
two separate and highly-prospective areas. The first area forms a westward
extension to the Company's existing group of licences centred on Certej. This
western extension covers some 329 square kilometres. The block of licences
includes the well-known Brad mines, which have produced as much as 20 million
ounces of gold according to historic records, and were operated by the
Romanian state until 2006. Deposits in this geological terrain include
examples of disseminated gold, porphyry mineralisation as well as the more
prolific and higher-grade epithermal deposits. The Company has also acquired
raw data from an airborne magnetic and radiometric geophysical survey which
covers much of the area. Re-processing of the data has assisted in defining
structures which have controlled intrusive activity and mineralisation along
the belt allowing more detailed surveys to focus on the prospective areas. A
programme of geochemical sampling is underway to ensure there is complete
cover along the Brad belt and this will be combined with geological mapping
and the geophysical data to define drill targets. This is the first time that
an integrated modern exploration programme has been executed over the whole
Brad-Certej belt.
    The second area covers some 137 square kilometres and includes the Deva
copper gold porphyry and the Muncel-Vetel massive sulphide deposits. The Deva
porphyry was operated by the Romanian state owned mining company between 1950
and 2001. During this time it produced some 19 million tonnes of ore at a
grade of 0.7% copper. Gold grades were not recorded systematically throughout
the mine life but are indicated to be approximately 0.5 g/t gold. The porphyry
is defined to a depth of 800 metres and is one of a series of intrusives
within a volcanic complex, which is completely under explored. The
Muncel-Vitel area hosts known copper, lead and zinc mineralisation in a series
of stacked massive sulphide horizons recorded as being Volcanogenic Massive
Sulphides (VMS) type. The mineralisation has been traced along more than 5
kilometres of strike length and the area has never been investigated with
modern techniques. The Company has commenced detailed remapping of the Deva
Porphyry volcanic complex and a programme of ground magnetic surveying is also
underway. Reconnaissance work, including measurements of magnetic
susceptibility, has shown that the method is highly effective in identifying
new areas of porphyry mineralisation, which have not been recognised
historically or are concealed by cover, for future drill testing.

    
                            EXPLORATION IN TURKEY

    -   New higher grade gold zone identified near Ardala
    

    In April 2008 the company entered into a joint venture (JV) with Ariana
Resources plc (Ariana) with respect to mineral properties in the Eastern
Pontide area of northeast Turkey. Significant progress has been made both in
assessing the properties within the JV and in identifying new areas for
acquisition following ten months of exploration.
    Mapping and lithological sampling of the advanced Ardala porphyry target
has confirmed that porphyry mineralisation continues to the south of the
previously recognised outcrops. Modelling of the newly discovered zone is now
complete and drill testing will commence in mid 2009.
    Within the Ardala concession, a higher-grade gold zone has been
identified by rock chip and soil sampling some three kilometres to the
southwest of the main porphyry. A programme of detailed mapping and
lithological sampling is underway to estimate strike and width prior to
trenching and drilling. The Company is also consolidating ground to the south
of Ardala over known alteration systems relating to high-sulphidation systems
with potential porphyry mineralisation underlying these.
    The Company continues to look for new opportunities in Turkey and the
exploration team has conducted a number of exploration site visits to various
portfolios, properties and deposits, both within the JV area of interest and
elsewhere in Turkey.

    Documents to be sent to shareholders

    Copies of the Company's Annual Report, Management's Discussion and
Analysis and Consolidated Financial Statements for the year ended 31 December
2008, and copies of the Notice of Meeting and Management Proxy Circular for
the Annual Meeting of Shareholders of the Company to be held on 20 May 2009,
will be sent to Shareholders and filed on SEDAR at www.sedar.com

    About European Goldfields

    European Goldfields Limited is a resource company involved in the
acquisition, exploration and development of mineral properties in Greece,
Romania and South-East Europe.

    Greece - European Goldfields holds a 95% interest in Hellas Gold S.A.
Hellas Gold owns three major gold and base metal deposits in Northern Greece.
The deposits are the polymetallic operation at Stratoni, the Olympias project
which contains gold, zinc, lead and silver, and the Skouries copper/gold
porphyry project. Hellas Gold commenced production at Stratoni in September
2005 and started selling an existing stockpile of gold concentrates from
Olympias in July 2006. Hellas Gold is applying for permits to develop and
build the Skouries and Olympias projects.

    Romania - European Goldfields owns 80% of the Certej gold/silver project
in Romania. In July 2008, the National Agency of Mineral Resources approved
the technical feasibility study in support of its permit application and
issued a new mining permit for the Certej project.

    Resources & reserves parameters

    For additional information on the resource and reserve estimates quoted
in this news release, please refer to the Company's Resources & Reserves
Declaration at www.egoldfields.com/goldfields/resources.jsp. Patrick Forward,
General Manager, Exploration of the Company, was the Qualified Person under
Canadian National Instrument 43-101 responsible for reviewing the disclosure
of resource and reserve estimates quoted in this news release.

    Forward-looking statements

    Certain statements and information contained in this document, including
any information as to the Company's future financial or operating performance
and other statements that express management's expectations or estimates of
future performance, constitute forward-looking information under provisions of
Canadian provincial securities laws. When used in this document, the words
"anticipate", "expect", "will", "intend", "estimate", "forecast", "planned"
and similar expressions are intended to identify forward-looking statements or
information. Forward-looking statements include, but are not limited to, the
estimation of mineral reserves and resources, the timing and amount of
estimated future production, costs and timing of development of new deposits,
permitting time lines and expectations regarding metal recovery rates.
Forward-looking statements are necessarily based upon a number of estimates
and assumptions that, while considered reasonable by management, are
inherently subject to significant business, economic and competitive
uncertainties and contingencies. The Company cautions the reader that such
forward-looking statements involve known and unknown risks, uncertainties and
other factors that may cause the actual financial results, performance or
achievements of the Company to be materially different from its estimated
future results, performance or achievements expressed or implied by those
forward-looking statements and the forward-looking statements are not
guarantees of future performance. These risks, uncertainties and other factors
include, but are not limited to: changes in the price of gold, base metals or
certain other commodities (such as fuel and electricity) and currencies;
uncertainty of mineral reserves, resources, grades and recovery estimates;
uncertainty of future production, capital expenditures and other costs;
currency fluctuations; financing and additional capital requirements; the
successful and timely permitting of the Company's Skouries, Olympias and
Certej projects; legislative, political, social or economic developments in
the jurisdictions in which the Company carries on business; operating or
technical difficulties in connection with mining or development activities;
the speculative nature of gold and base metals exploration and development,
including the risks of diminishing quantities or grades of reserves; the risks
normally involved in the exploration, development and mining business; and
risks associated with internal control over financial reporting. For a more
detailed discussion of such risks and material factors or assumptions
underlying these forward-looking statements, see the Company's Annual
Information Form for the year ended 31 December 2007, filed on SEDAR at
www.sedar.com. The Company does not intend, and does not assume any
obligation, to update or revise any forward-looking statements whether as a
result of new information, future events or otherwise, except as required by
law.





For further information:

For further information: European Goldfields: David Reading, Chief
Executive Officer, e-mail: info@egoldfields.com, Tel: +44 (0)20 7408 9534;
Buchanan Communications: Bobby Morse, Katharine Sutton, e-mail:
bobbym@buchanan.uk.com, Tel: +44 (0)20 7466 5000; RBC Capital Markets: Sarah
Wharry, e-mail: sarah.wharry@rbccm.com, Tel: +44 (0)20 7653 4804

Organization Profile

EUROPEAN GOLDFIELDS LTD.

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