Definitive Feasibility Study Demonstrates Certej Project Viability

    WHITEHORSE, YT, July 23 /CNW Telbec/ - European Goldfields Limited (AIM:
EGU / TSX: EGU) ("European Goldfields" or the "Company") is pleased to
announce the results of the definitive feasibility study for its Certej
project in Romania.
    The study has been prepared by European Goldfields using International
and Romanian expert consultants in key areas. A Canadian National Instrument
43-101 report summarising the study will be filed on SEDAR within the next
45 days.
    Commenting on the study David Reading, Chief Executive Officer of
European Goldfields said: "The conclusions of this definitive feasibility
study underpin Certej as a key component of our portfolio that will contribute
significantly to achieving mid tier gold production. The study represents
another important milestone in the development and permitting of our projects
in Southeast Europe."

    Study Result Highlights

    Tonnes                                                            32.8Mt
    Gold Grade                                                       2.0 g/t
    Silver Grade                                                    11.4 g/t
    Strip Ratio                                                          3.1
    Annual Throughput                                                    3Mt
    Overall Gold Recovery                                                 81%
    Overall Silver Recovery                                               74%
    Base Life of Mine                                             11.2 years

    Production                                 Years 1-3        Life of mine
    Average gold production, oz pa               172,000             156,000
    Average silver production, oz pa             720,000             814,000

    Capital                               (euro) million      (euro) million
                                                 Initial          Sustaining
    Mining Fleet                                    19.0                 7.4
    Pre-strip                                        8.5                   -
    Plant                                           91.5                   -
    Infrastructure                                  11.0                 2.9
    TMF                                              6.5                14.4
    Rehabilitation                                                       6.5
    TOTAL                                          136.5                31.2

    Cash Operating Cost                 (euro) per tonne            US$/oz(*)
    Mining                                   1.23 (mined)                111
    Processing (inc TMF)                10.53 (processed)                234
    G & A                                0.36 (processed)                  8
    TOTAL                                                                353
    (*) Net of silver by product credits
    Gold Price ($/oz)                                                    650
    Silver Price ($/oz)                                                   12
    Post tax IRR                                                        20.3%


    The Certej definitive feasibility study is based on conventional open pit
mining of the Certej gold/silver project, processing of 3Mt of ore a year with
production of doré on site and tailings storage in an adjacent facility.

    Project Location and History

    Certej is an epithermal gold/silver deposit located in the "Golden
Quadrilateral" area of the Apuseni Mountains of Transylvania in Western
Romania, 12km from the regional town of Deva.
    European Goldfields owns 80% of the project through its subsidiary Deva
Gold.  There is an existing open pit that was operated by the Romanian State
mining entity Minvest, until 2006 for which Deva Gold holds a valid operating

    Study Contributors

    The definitive feasibility study was carried out by European Goldfields
and its subsidiary Deva Gold in collaboration with the following international

    - Geology - Deva Gold with review by RSG Global, now part of Coffey
    - Resources and Reserves - RSG Global, now part of Coffey Mining
    - Mine Planning and Scheduling - In Silico Mining
    - Metallurgical Testwork - SGS-Minerals Services, HRL Testing, Xstrata
      Technology, Amtel
    - Process Route - Aker Solutions (formerly Aker Kvaerner Engineering
      Services), Core Resources, Xstrata Technology
    - Plant Design - Aker Solutions, Xstrata Technology
    - TMF Design - University of Bucharest, Cepromin and Golder Associates
      United Kingdom
    - Environmental - Consortium of internationally recognised Romanian
      institutes and consultants led by the Faculty of Environmental Science
      in Cluj


    The Certej orebody is well defined based on an extensive drilling and
exploration programme which defines a Measured and Indicated Resource
comprising 41.5 Mt of ore with grades of 2.0 g/t Au & 11 g/t Ag at a 0.8 g/t
Au cut-off. The main mineralised zone is some 1,500 meters long by 500 meters
wide and occurs as sub-horizontal, to moderately dipping zones.
    The mineable reserve is included in the resource and comprises
32.8 million tonnes of ore grading 2.0 g/t gold and 11.4 g/t silver,
representing 2.1 million ounces of gold and 12.0 million ounces of silver
mined by conventional open pit methods with a strip ratio of 3.1:1.

    Mine Planning and Scheduling

    The study is based on owner operated mining of 3 million tonnes of ore
per annum over at least eleven years by a conventional open pit, drill/blast
and shovel/truck method. The mining will extend the existing open pit at
Certej and the mine will eventually comprise a main pit and a west pit.


    The run of mine ("ROM") ore will be processed in three distinct stages:

    - Flotation of ROM material to produce a pyrite, gold-silver concentrate
    - Ultra fine grinding and ambient pressure leaching of the concentrate
      using Xstrata's Albion process, to liberate the gold and silver
    - A standard CIL circuit to process the oxidised concentrate and produce
      gold and silver doré on site

    Annual metal production will average approximately 160,000 ounces of gold
and 800,000 ounces of silver. The process route is based on extensive
metallurgical sampling and testwork, including a full programme of locked
cycle flotation tests, large scale laboratory Albion Process tests, two
continuous pilot scale runs of the Albion Process and a continuous CIL pilot
plant test. Material for the testwork was obtained from diamond drill core and
was representative of the entire mineable reserve.

    Tailings management

    The proposed TMF is located in a valley roughly 1.5 kilometres to the
northeast of the mine site. The flotation tailings, comprising approximately
80% of the total tailings, will be stored in the main dam. The CIL tailings
will be held in a separate dam located immediately upstream of the flotation
dam and will re-circulate water back to the CIL plant.
    The Company also has a second option for the TMF located closer to the
mine. This second option has sufficient capacity to store life of mine
tailings and a study is being undertaken to define the engineering design and
establish the expenditure for this alternative.
    The costs of the first option have been incorporated into the capital
    A waste management plan has been incorporated in the recently submitted
Environmental Impact Study.


    The area has experienced a substantial economic revival in the past four
years with major investments from international and local corporations. It is
served by good infrastructure with 110kV power supply and water pipelines
arriving within two kilometres of the mine. The project has paved roads
directly to site and the region has a large road-building programme to improve
these further. The Certej project also benefits from two rail loading
facilities at the major rail-head at Deva. Deva is connected to the main Black
Sea port of Constantia by the Romanian highway and rail network and is
serviced by three international airports, all within two hours drive of the
    The project will employ over 300 people from the Certej area, whose
recent mining history ensures a good skills base is available in the local
labour force.


    There are no settlements in the vicinity of the proposed mine and TMF
sites. Detailed field work has established that there are no archaeological
remains on the site. Both the mine site and the TMFs are shielded by
topography and there is no visual impact on settlements. All the necessary
studies to comply with Romanian and EU legislation and international best
practice have been completed.

    Capital Costs

    Capital costs comprise the estimates produced by each contributing
consulting group.
    Aker Solutions made a series of recommendations regarding plant
optimisation which were subsequently actioned by Deva Gold. The current
capital cost estimate for the plant incorporates the following optimisation

    - Improved site layout following geotechnical investigations
    - Competitive up to date quotations for equipment
    - Use of local construction rates based on local quotes
    - Use of Romanian contractors
    - Other in country cost opportunities

    Additional opportunities are being investigated, but have not yet been
incorporated, into the cost estimate, including:

    - Use of second hand grinding mills,
    - Use of waste rock for the new highway project in the district that will
      reduce waste rock disposal quantities and costs
    - Increasing the project life to 15 years through the processing of
      existing dump material and lower grade material that falls within the
      current pit design and would be economic above a gold price of $700.

    Financial returns

    The financial returns achieved by the project show that it is robust at
metal prices of $650 per ounce for gold and $12 per ounce for silver and the
IRR exceeds the company threshold of 20%.
    The internal rate of return includes taxation of 16% and the deduction of
a 2% royalty on gross revenues. In addition, project finance has been assumed
on the basis of a conservative 50:50 debt: equity ratio.

    Progress on Permitting

    The permitting process is now well advanced and Deva Gold has already
submitted a Technical Feasibility Study, an Environmental Impact Study and a
Zonal Urbanisation Plan (PUZ) to the relevant Romanian authorities.
    Deva Gold already holds an operating permit for Certej, by virtue of the
small scale production and sale of concentrates carried out from an existing
open pit. The EIS and the Technical Feasibility Study address a proposed
increase in mine production at Certej and the processing of ore on site. The
environmental permit and an updated mining permit are expected in Q4 2008
following completion of the public consultation process.
    Deva Gold has advanced the planning procedures for the Zonal Urbanisation
Plan approval including two public meetings with the affected local
communities. The regional Environmental Department from Timisoara has received
an official letter from the local Council of Certej giving its full support to
the project, recognising the sustainable development and benefits the project
brings to the local economy.

    The Way Forward

    The definitive feasibility study demonstrates that Deva Gold has
developed an efficient and viable solution for mining and processing the
Certej deposit to produce gold/silver doré. This solution has been based on
extensive testwork and the flow sheet comprises well established unit
operations. The studies undertaken also demonstrate that the project is
technically sound. The acquisition of land needed to build the project is
underway. Following receipt of the necessary Environmental and Construction
permits the Company will work toward raising the necessary project finance.
The project will then progress to detailed engineering, procurement and

    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 gold
concentrates from Olympias 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. The Company submitted in March 2007 a technical feasibility study
to the Romanian government in support of a permit application to develop the
project. In March 2008, European Goldfields submitted the Environmental Impact
Study to the Romanian environmental authorities to start the assessment of the
environmental impact of 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 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 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,, +44 (0)20 7408 9534; Buchanan
Communications: Bobby Morse,; Ben Willey, +44 (0)20
7466 5000; Renmark Financial Communication: Henri Perron,; John Boidman,;
Media - Eva Jura,, +1 514 939 3989, +1 514 939
3717;; RBC Capital Markets: Andrew K Smith,, +44 (0)20 7029 7882

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