Certej Reserves Increased by 20% - Life-of-Mine Extended by Two Years

    WHITEHORSE, YT , Oct. 9 /CNW Telbec/ - European Goldfields Limited
(TSX / AIM: EGU) is pleased to announce a 20% increase in gold reserve ounces
for the Certej project, which can now be reported as follows:

                               Certej Reserves
                               Average     Million       Average     Million
    Reserve      Million          Gold      Ounces        Silver      Ounces
    Category      Tonnes    Grade (g/t)       Gold    Grade (g/t)     Silver
    Probable        32.8           2.0         2.1          11.4        12.0
    Note: Reserve based on pit optimisation using a gold price of $425/oz and
          a silver price of $7/oz.

    The new reserve results from a better conversion of resources into
reserves, combined with increased resources (see below), and is based on the
production of a gold-bearing concentrate followed by the production of gold
and silver as doré on site by means of the Albion Process. The previous
reserve estimate published in April 2006 was based on the less-economical
development option involving the direct sale of a gold-bearing flotation
    The better conversion from resources to reserves reflects improved
metallurgical recoveries following completion of extensive bulk continuous
metallurgical test-work, an in-house pre-feasibility study and subsequent pit
optimisation and pit design work by RSG Global Consulting Pty Ltd ("RSG
Global"), which included a geotechnical drilling programme designed by Golder
Associates of the UK.
    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 Carbon in Leach ("CIL") process.
    The deposit will be mined by open pit methods with a strip ratio of 3.1:1.
The project will involve the mining and processing of 3.0 million tonnes of
ore per annum over at least eleven years, compared to the nine-year mine life
under the previous reserve estimate. This is expected to yield approximately
160,000 oz of gold and 820,000 oz of silver per year in doré.
    Commenting on the announcement, David Reading, Chief Executive Officer of
European Goldfields, said: "We are delighted to report a 20% increase in gold
reserve ounces and in mine life at Certej. The new reserve estimate confirms
that the Certej project is robust at $425/oz gold. Our four projects in Greece
and Romania now contain reserves of almost 10M oz of gold, 78M oz of silver,
0.8M tonnes of copper and 1.6M tonnes of combined lead and zinc."

    Increase in Certej Resources

    European Goldfields is also pleased to announce a 9.2% increase in gold
resource ounces for its Certej project in Romania, which can now be reported
as follows:

                               Certej Resources
                               Average     Million       Average     Million
    Resource     Million          Gold      Ounces        Silver      Ounces
    Category      Tonnes    Grade (g/t)       Gold    Grade (g/t)     Silver
    Measured         3.9           2.3         0.3             5         0.7
    Indicated       37.6           1.9         2.3            11        13.7
    Measured +
     (total)        41.5           2.0         2.6            11        14.3
     Domains)        3.4           1.6         0.2             4         0.4
     (Far West/
     Domains)        3.8           1.4         0.2             8         1.0
     (total)         7.1           1.5         0.3             6         1.4
    Note: At a 0.8g/t Au lower cut-off grade. Uniform conditioning and a
          12.5mE x 6.25mN x 2.5mRL selective mining unit reported for the
          west and eastern domains and ordinary kriging for the far west and
          central domains. The previous resource estimate was quoted at a
          1.0g/t Au lower cut-off grade; however, the 9.2% increase in gold
          resources is calculated using a comparable lower cut-off grade of
          0.8g/t Au. Small numeric differences may occur due to number

    The new resource follows the completion of a programme of in-fill
drilling of inferred resources and also incorporates data from holes used for
geotechnical work and metallurgical sampling. The new drilling also identified
higher grade mineralisation on the southern flank of the west domain of the
    Harry Warries, Ben Palich and Jan de Visser of independent consultants
RSG Global have reviewed this news release and were the Qualified Persons
under Canadian National Instrument 43-101 responsible for preparing the
updated resource and reserve estimates for the Certej deposit quoted above. A
technical report from RSG Global will be filed on SEDAR (www.sedar.com) within
the next 45 days.

    Background Information on Certej

    Capital and operating costs - Total capital costs for the Certej project
are currently estimated at $111 million for the purchase of mining equipment
and land, and the construction of a process plant, tailings and other
infrastructure. However, European Goldfields is investigating "through the
fence" oxygen supply, which would save some $23 million of oxygen plant
capital. The mining costs are currently estimated at $1.23/tonne of material
mined, and the processing costs are estimated at $9.09/tonne of ore processed.
These estimates will be updated once the full feasibility study on Certej is
completed (see below).
    Technical feasibility study submitted - In March 2007, European
Goldfields submitted a Technical Feasibility Study ("TFS") to the Romanian
government, in support of its permit application to develop the Certej
    The metallurgical process design is based on extensive comminution and
flotation testwork to produce a gold bearing concentrate and then processing
by means of the Albion Process. The project is expected to yield an average of
308,000 tonnes of flotation concentrate per annum with high grades ranging
between 17-19 g/t gold and 80-130 g/t silver (depending on the source of the
ore in the deposit), with a flotation gold recovery of approximately 90%,
followed by an Albion gold recovery of approximately 90%, resulting in a total
process gold recovery of 81%. This is expected to yield approximately 160,000
oz of gold and 820,000 oz of silver per year in doré.
    The residues from the flotation and gold plants will be disposed of in
two separate but adjoining tailings management facilities.
    Albion Process Technology achieved 90% gold recovery in continuous pilot
plant tests - European Goldfields is currently completing an extensive
metallurgical testwork programme using the Albion Process at the facilities of
Hydrometallurgical Research Laboratories Testing ("HRL") in Australia. Small
scale batch tests had achieved gold recoveries of 90-93% and established the
optimum conditions for the continuous pilot plant testwork required to prove
the amenability of the Albion Process for the Certej concentrate.
    A Phase 1 pilot scale test was carried out which confirmed that gold
extractions in excess of 90% could be achieved on a continuous basis at
sulphur oxidation rates in the Albion Process of around 70%. The testwork also
confirmed the consumable levels were in the expected range.
    A programme of flotation concentrate grade optimisation work was then
undertaken and on completion a second Phase 2 continuous pilot plant run was
completed in June 2007. This confirmed the high gold extractions of 90%
achieved in the Phase 1 run and that the flotation concentrate is amenable to
treatment by the Albion Process. A continuous CIL pilot plant was then run for
4 1/2 days on the product from the Phase 2 Albion Process run. Further
optimising work and equipment tests by vendors are also nearing completion and
a final design report will then be issued by Core Resources and Xstrata
Technology allowing an engineering design company to calculate costs for the
bankable feasibility study.
    During the testwork campaign at HRL, a large batch scale Albion test was
completed on the concentrate from the West ore zone of the Certej deposit
which had previously proved to be uneconomic to processing using the Albion
Process. This work demonstrated that by applying a slightly higher oxidation
rate, a gold recovery of 90% could also be achieved from the West ore zone.
This is a very positive result as it could increase the operating life of the
Albion Process by at least three years.
    A definitive mineralogical study describing the four ore zones of the
Certej deposit was completed by Amtel of Canada which indicated that there is
potential for increasing flotation gold and silver recoveries above those
achieved in the laboratory scale tests.
    Environmental impact study nearing completion - In 2006, European
Goldfields completed all the necessary Environmental Impact Assessments
(Levels I and II) and a Social Impact Assessment Study in support of its
permit application to develop the Certej project.
    Work is now progressing well on the Certej environmental impact study
("EIS"), which is due for completion in October 2007 after some contributory
studies are finalised. The EIS will have been carried out over a period of a
year to cover the four seasons for accumulating certain required base line
data. The EIS is a detailed multi-discipline study assessing the
environmental, social and health impacts of the project on the affected area.
    Full feasibility study to be completed by Q1 2008 - Once the EIS is
completed, European Goldfields expects to complete a full feasibility study,
which will be used for internal approval and presentation to banks and other
sources of potential financing of the project. The full feasibility study is
scheduled for completion in the first quarter of 2008.
    A contract to undertake an engineering study of the process plant and
associated infrastructure has been awarded to Aker Kvaerner Engineering
Services. This will include the final results of the completed Albion Process
testwork programme, the design criteria package for the Ultra Fine Grinding
IsaMill and the leaching process with the associated costs. Site visits have
been undertaken to gather the additional design and site data needed to
produce the definitive cost estimate and study.
    Clear path to permitting - European Goldfields has established a clear
path to applying for permits to develop the Certej project, having already
submitted the TFS to the Romanian government in March 2007, which will be
followed by the submission of the EIS in the fourth quarter of 2007.
    In September 2006, European Goldfields announced that the Hunedoara
County Council had issued a General Urbanisation Certificate for the Certej
project. The certificate confirms the designation of Certej as an industrial
mining area and confirms local community support for the project. This
important milestone is the first official step in the permitting process for
    All mining permits and a detailed urbanisation plan are expected by
mid-2008 following a standard public consultation process with the local

    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 commenced selling an existing stockpile of Olympias gold
concentrates in July 2006. Hellas Gold is applying for permits to develop the
Skouries and Olympias projects.
    Romania - European Goldfields owns 80% of the Certej gold/silver project
in Romania. European Goldfields submitted in March 2007 a technical
feasibility study to the Romanian government, in support of a permit
application to develop the project.

    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 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 2005, 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

For further information:

For further information: European Goldfields: David Reading, Chief
Executive Officer, info@egoldfields.com, +44 (0)20 7408 9534; Buchanan
Communications: Bobby Morse: bobbym@buchanan.uk.com; Ben Willey, +44 (0)20
7466 5000; Renmark Financial Communication: Neil G. Murray-Lyon:
nmurraylyon@renmarkfinancial.com; Barbara Komorowski:
bkomorowski@renmarkfinancial.com; Media - Eva Jura:
ejura@renmarkfinancial.com, (514) 939-3989; Evolution Securities: Simon
Edwards: simon.edwards@evosecurities.com; Neil Elliot, +44 (0)20 7071 4300

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