Results for 2007 - Strong financial performance - $43.6m operating cash flow - $219m cash balance - Solid platform for growth

    WHITEHORSE, YT, March 19 /CNW Telbec/ - European Goldfields Limited
(AIM: EGU / TSX: EGU) ("European Goldfields" or the "Company") today reports
its results for the financial year ended 31 December 2007. Highlights are:

    Financial highlights:

    - Sales of $86.4m, up 65% over 2006
    - Operating cash flow of $43.6m, up 125% over 2006
    - Profit (before tax) of $33.4m, up 178% over 2006
    - Working capital of $226.4m at 31 December 2007; compared to $41.9m at
      31 December 2006
    - Earnings per share of $0.16, compared to $0.03 in 2006

    Operational highlights:

    - Stratoni: Production up 27% versus 2006 - New reserves continue to
      replace mining depletion
    - Skouries: Fabrication of long lead time equipment has commenced
    - Olympias: Market created for gold concentrates - Six-fold increase in
      sales versus 2006
    - Certej: Key feasibility studies completed to high accuracy level -
      Permitting process well underway
    - Exploration in Greece: Airborne survey outlines intrusive belt -
      Progress in target definition

    Corporate highlights:

    - Acquisition of an additional 30% interest in Hellas Gold, increasing
      stake to 95%; total cost of investment in Hellas Gold of $25 per gold
      equivalent reserve ounce
    - Reinforced strategic alliance with Aktor and its parent company
      Elliniki Technodomiki, consolidating the partnership for building of
      gold projects in Greece and South-East Europe
    - $180 million raised through equity financing and sale of Stratoni
      silver stream
    - Joint venture in Turkey with Ariana Resources, endorsing growth in
      South-East Europe
    - Added to S&P/TSX Global Gold Index in September 2007; S&P/TSX Composite
      Index in March 2008

    Commenting on the results, David Reading, Chief Executive Officer of
European Goldfields, said: "The year ended 31 December 2007 saw significant
progress in the stated growth strategy of building European Goldfields into a
mid-tier mining company. In less than four years, shareholders in European
Goldfields have benefited from a dramatic turnaround from being a loss-making
exploration company into one which produced in 2007 over $23 million in net
profits, generated $44 million in operating cash flow, and increased its
ownership from 30% to 95% of its Greek assets. In addition, European
Goldfields has approximately $220 million of cash in the bank with net
attributable reserves of over 9Moz of gold and 72Moz of silver, 750,000 tonnes
of copper, 664,000 tonnes of lead and 889,000 tonnes of zinc at the end of the
financial year. The last 12 months has provided a strong growth platform for
the next phase of our development."

    Conference Call & Webcast - 19 March 2008 at 10am ET / 2pm GMT - European
Goldfields will host a conference call on Wednesday 19 March 2008 at
10:00 a.m. ET / 2:00 pm (London, UK time) to update investors and analysts on
its results. Participants may join the call by dialing one of the three
following numbers, approximately 10 minutes before the start of the call:

    - From North America: (Local) 416-644-3416 or (toll free): 1-800-732-9307
    - From the UK, Austria, Belgium, Denmark, France, Germany, Ireland,
      Italy, Netherlands, Norway, Sweden & Switzerland (toll free):

    A live audio Webcast will be available on:

                           SELECTED FINANCIAL DATA

                                                      Year ended 31 December

    (in thousands of US dollars,                          2007          2006
    except per share amounts)                                $             $
    Statement of loss and deficit
    Sales                                               86,405        52,438
    Gross profit                                        43,787        27,252
    Profit before income tax                            33,435        12,008
    Profit after income tax                             28,218         7,184
    Non-controlling interest                            (5,019)       (4,182)
    Profit for the period                               23,199         3,002
    Earnings per share                                    0.16          0.03

                                                   31 December   31 December
                                                          2007          2006
    (in thousands of US dollars)                             $             $
    Balance sheet
    Working capital                                    226,431        41,854
    Total assets                                       782,131       311,943

    European Goldfields' audited consolidated financial statements and
management's discussion and analysis for the years ended 31 December 2007 and
2006 are filed on SEDAR at

                             CORPORATE ACTIVITY


    - Acquisition of an additional 30% interest in Hellas Gold, increasing
      stake to 95%
    - $180 million raised through equity financing and sale of Stratoni
      silver stream
    - Joint venture in Turkey with Ariana Resources, endorsing growth in
      South-East Europe

    Acquisition of an additional 30% interest in Hellas Gold - On 29 June
2007, the Company completed the acquisition of an additional 30% interest in
Hellas Gold S.A. ("Hellas Gold"), increasing its stake to 95%. The purchase
price was agreed at $178 million, which incorporated a 15% discount to the
"see-through value" of Hellas Gold. The purchase price was paid by the
allotment to the vendor Aktor S.A. ("Aktor") of 35,447,246 common shares,
representing 19.9% of the issued and outstanding shares of the Company on a
diluted basis, and the balance of $8.4 million in cash, 50% of which Aktor has
agreed to re-invest into Hellas Gold as funding towards maintaining its
residual 5% shareholding interest in Hellas Gold.
    This transaction was, in essence, a share swap in that approximately 95%
of the purchase price was paid to Aktor in common shares of the Company. This
reinforces the Company's strategic alliance with Aktor and its parent company
Elliniki Technodomiki TEB A.E. (ATHEX: ELTEX) ("El-Tech") and consolidates the
partnership for the building of gold projects in Greece and South-East Europe.
    El-Tech is a large Greek conglomerate with a market capitalisation in
excess of $2 billion with investments in five fields: construction,
concessions, energy, real estate, and mining and quarries. Aktor, Greece's
largest construction company, employs over 600 engineers, has extensive
expertise in the construction of large industrial projects and, due to its
tunnelling expertise, possesses one of the largest fleets of underground
equipment in Europe.
    Furthermore, to demonstrate and confirm its long-term commitment to the
Company and its projects, Aktor has agreed not to sell the European Goldfields
shares it received as consideration until the date on which gold production
commences in Greece (or four years after the closing of the Acquisition, if

    $180 million raised through equity financing and sale of Stratoni silver
stream - Concurrently with the Acquisition, the Company completed a treasury
offering of 27.6 million shares, for total gross proceeds of Cdn$138 million.
The Acquisition combined with the treasury offering resulted in a 50% increase
in the Company's market capitalisation.
    Also, in April 2007, Hellas Gold agreed to sell to Silver Wheaton
(Caymans) Ltd. ("Silver Wheaton") all of the silver metal to be produced from
ore extracted during the mine-life within an area of some 7 km2 around its
zinc-lead-silver Stratoni mine in northern Greece (the "Silver Wheaton
Transaction"). Silver production at Stratoni is a by-product of its lead-zinc
    The sale was made in consideration of a prepayment to Hellas Gold of $57.5
million in cash, plus a fee per ounce of payable silver to be delivered to
Silver Wheaton of the lesser of $3.90 (subject to an inflationary adjustment
beginning after year three) and the prevailing market price per ounce. The
Stratoni proven and probable silver reserve contained approximately 12 Moz of
    The Silver Wheaton Transaction does not apply to any additional silver
resources within Hellas Gold's 317 km2 of mining and exploration licences in
northern Greece, for example silver resources at the Company's other mines of
Olympias and Certej which contain 66 Moz of proven and probable silver
reserves, except for a right of first refusal granted to Silver Wheaton on
similar future transactions over the Company's silver assets.

    Joint venture in Turkey with Ariana Resources, endorsing growth in
South-East Europe - In February 2008, the Company signed a Heads of Agreement
with Ariana Resources plc (AIM: AAU) ("Ariana") for the joint development of
Ariana's properties in North-eastern Turkey, which includes the Ardala
copper-gold porphyry and eleven other licences covering a total area of
168 km2.
    These projects are located in the Pontides region of Turkey, a highly
prospective geological terrain containing several major deposits. The Ardala
Cu-Au porphyry has been the subject of reconnaissance drilling around the
periphery of a porphyry intrusion, which identified encouraging grades of
copper and gold. It has a 600m x 700m surface exposure centered on a magnetic
high of 1,000m x 1,000m extent. Copper-gold mineralisation has also been
identified on other properties in the vicinity of Ardala within granitoids and
in the surrounding country rocks.
    Under the agreement, European Goldfields will initially own 51% of the
properties transferred by Ariana into the joint venture. European Goldfields
will then fund all development costs of these initial properties and any
future properties located within a defined area in North-eastern Turkey until
completion of a Bankable Feasibility Study, at which time European Goldfields'
interest in each relevant project will increase to between 80% and 90%,
    In addition, European Goldfields has agreed to subscribe for new shares in
Ariana at 5 pence per share in a private placement, resulting in European
Goldfields owning 20% of the outstanding shares in Ariana following the
placement, for a total consideration of approximately 890,000 pounds sterling.
    Ariana also holds properties in Western Turkey where exploration of
epithermal vein systems has drill tested a number of targets and defined other
targets for further investigation. Ariana has also developed an extensive
remote sensing database covering the most prospective parts of Turkey.
    Completion of the joint venture and the placing is expected by mid-April
2008, conditional upon satisfactory due diligence and the signing of
definitive agreements.

                         STRATONI OPERATIONS (GREECE)


    - Production up by 27% versus 2006
    - New reserves continue to replace mining depletion
    - Focus on development to ramp up production
    - Exploration continues to define new resources

    Production up by 27% versus 2006 - The Stratoni mine consists of a
lead-zinc-silver deposit and lies approximately 4 km from the coastal town of
Stratoni in northern Greece. The Company's 95%-owned subsidiary Hellas Gold
mined a total of 214,875 wet tonnes in 2007 (2006 - 176,691) at its Stratoni
mine. Hellas Gold completed 26 shipments in 2007 (2006 - 20). This translates
into an increase of 27% in tonnes of base metal concentrates sold. Sales from
Stratoni were as follows:

                                                          2007          2006
    Ore mined (wet tonnes)                             214,875       176,691
    Zinc concentrate (tonnes)                           38,152        32,351
    - Containing payable:   Zinc (tonnes)(*)            15,891        13,775
    Lead concentrate (tonnes)                           23,123        15,780
    - Containing payable:   Lead (tonnes)(*)            14,963        10,467
                            Silver (oz)(*)           1,172,234       818,139
    Inventory (end of period)
    Ore mined (wet tonnes)                                   -         2,499
    Zinc concentrate (tonnes)                            1,689            37
    Lead/silver concentrate (tonnes)                        49           214
    (*) Net of smelter payable deductions

    On average, mined and processed lead and zinc grades in 2007 have been
16.2% and 3.6% respectively higher than reserve grades. In 2007, zinc and lead
concentrates sales increased by 18% (to 38,152 tonnes) and 46% (to
23,123 tonnes), respectively.

    New reserves continue to replace mining depletion - European Goldfields is
pleased to announce an increase in reserves at Stratoni, which can now be
reported as follows under Canadian National Instrument 43-101 as at
31 December 2007:

                                   Ag     Ag     Pb       Pb     Zn       Zn
    Reserve Category  '000t(*)    g/t  Moz(*)     %  '000t(*)     %  '000t(*)
    Proven              1,904   193.3   11.8    7.3      139    9.1      173
    Probable              313   190.0    1.9    7.5       24   11.2       35
    Total               2,217   192.9   13.7    7.3      163    9.4      208
    (*) After depletion of ore extracted from the start of mining operations
        in Q4 2005 until 31 December 2007.

    Total reserve tonnes have increased by 11% over the previous reserves
published in January 2007, accounting for deduction of ore since then. The
additional tonnes are from the upper-west part of the orebody, which remains
open along strike. In addition, the grade of lead and silver has been
increased in the reserve, based on the underground sampling programme which
has allowed accurate modeling of higher grade zones. This has resulted in an
increase of 20% in lead metal, 10% in zinc metal and 25% in silver metal over
the previous reserve estimate published in January 2007, accounting for
deduction of ore since then.
    The new reserve will add an extra year to Stratoni's life of mine and the
improved grades will result in better revenues. Since the Stratoni mine
resumed production in September 2005, Hellas Gold has essentially managed to
replace mining depletion by new reserves.
    The new reserve has allowed Hellas Gold to adjust its yearly ore
production schedule as follows:

    - Year 2008: 290,000 tonnes
    - Year 2009: 375,000 tonnes
    - Year 2010: 400,000 tonnes
    - Year 2011: 400,000 tonnes
    - Year 2012: 400,000 tonnes
    - Year 2013: 352,000 tonnes

    This new reserve is based on an updated measured & indicated resource
estimate for the Stratoni orebody, which results from a new optimised
geological model based on revised geological mapping.
    Patrick Forward, General Manager, Exploration of European Goldfields, was
the Qualified Person under Canadian National Instrument 43-101 responsible for
preparing the updated resource and reserve estimates for the Stratoni deposit
quoted above. A technical report from Patrick Forward will be filed on SEDAR
( within the next forty-five days.

    Focus on development to ramp up production - Ore production rates from
underground have steadily increased from an average of 727 tonnes per day in
2006 to 885 tonnes per day in 2007, and the mine now operates effectively at
over 900 tonnes per day. The rate of ore production is expected to continue to
increase and reach 290,000 tonnes in 2008.
    Actual ore production for 2007 has been approximately 13% lower than the
originally forecasted 250,000 tonnes due in part to poor ground conditions in
the upper area of the mine. As a result, development of the main internal ramp
and cross-cut accesses in the upper parts of the mine was slower than expected
and face availability was reduced over most of the year. For the same reason,
forecast ore production for 2008 has been reduced from the originally
forecasted 350,000 tonnes to 290,000 tonnes.
    The excavation of a new decline to the base of the Mavres Petres orebody
is now essentially completed. Connection of the decline to the bottom of the
main ramp will improve material movement and ventilation and enable the
introduction of equipment as a support mechanism to ameliorate poor ground
conditions. The completion of the decline and the development of the internal
ramp and stope accesses to the higher, more extensive, levels of the orebody,
expected to provide additional reserves to the west, are now the main focus to
ensure a ramp-up in production to 400,000 tonnes of ore per year.

    Continued commitment to the environment and the community - Hellas Gold's
commitment to the environment continues in conjunction with investments in
social initiatives for the benefit of local communities in what is essentially
an under-developed region of Greece. For example, Hellas Gold (i) constructed
a new water treatment plant to ensure capacity to treat all mine water under
extreme conditions; (ii) installed two filter presses to produce a solid cake
requiring less surface storage space for fine tailings and water treatment
plant sludge; (iii) is backfilling voids at the old Madem Lakkos mine workings
with coarse tailings (49,000 m3 of voids filled to date), which reduces
storage space on surface and mine water pumping from underground; and
(iv) improving the lighting and transport facilities in the local communities
as well as other social improvements. This responsible approach to the
environment and local communities demonstrates the Company's commitment to
sustainable development.

    Exploration continues to define new resources - Stratoni benefits from
inferred resources comprising some 639,000 tonnes grading 7.7% lead, 9.9% zinc
and 203.4 g/t silver. These inferred resources are currently being mined at
the margin, confirming expected grades. Drilling on 25m centres is planned in
2008 in the upper west and lower east parts of the orebody which account for
some 85% of the inferred resources. The drill programme is designed to convert
the inferred resources to the measured and indicated categories, which can be
immediately converted to proven and probable reserves as the areas are
adjacent to current mine infrastructure.
    New mineralisation has been encountered during the excavation of the new
decline running between the existing reserve and mined-out areas at Madem
Lakkos. Initial results indicate that the zone has an average width of
6.55 metres with a weighted average grade of 0.7 to 14.8% Pb, 1.3 to 22.1% Zn
and 16 to 307g/t Ag. A drill programme designed to define indicated and
measured resources along at least 200 metres of strike and 75 metres of dip
has commenced with results expected in the second quarter of 2008. The new
decline will enable immediate access for mining of any new discovery in this
    Drilling in 2008 of inferred resources and of the newly identified zone is
expected to add an additional three years in total to the mine reserves, and
with the zones open further along strike, particularly to the west where
suitable host marbles and feeder structures are known to exist, additional
further reserves are expected to be defined in the future.

                          SKOURIES PROJECT (GREECE)


    - Fabrication of long lead time equipment has commenced
    - Low cost production due to low strip ratio and high grade gold-copper
      core at depth

    Fabrication of long lead time equipment has commenced - In June 2007,
Hellas Gold signed a 30 million euros contract with Outotec Minerals OY
("Outotec") for the supply of a large technology package for the Company's
95%-owned Skouries gold-copper project, which is located 35 km by road from
the Stratoni port in northern Greece.
    Outotec has already delivered a basic engineering package to Hellas Gold
for the grinding mills, flotation equipment, process control and paste
thickeners. Fabrication of the SAG and ball mills has commenced and they are
due ex works in the third quarter of 2009.

    Low cost production due to low strip ratio and high grade gold-copper core
at depth - The Company has completed the key technical studies for the full
feasibility study on Skouries. These studies include:

    - A cost and definition study for the process plant and associated
      infrastructure, undertaken by Aker Kvaerner Engineering Services
    - A cost and definition study for underground mechanical and electrical
      utilities, undertaken by Scott Wilson Mining
    - The design of the tailings management facility, undertaken by Golder
    - A study of hydrogeology and creek boundaries by the Greek Institute of
      Geology & Mineral Exploration (IGME), to be used in the development of
      a new hydrogeological model
    - A reserves estimate, undertaken by SRK Consulting
    - A basic engineering package by Outotec for the grinding mills,
      flotation equipment, process control and paste thickeners

    Basic and detailed engineering for the process plant and associated
infrastructure is being conducted by the firm ENOIA of Athens, Greece.
    Mining studies carried out to date confirm that Skouries can be mined as a
low strip open pit operation and as a highly productive underground mine. This
would produce annually up to 43,000 tonnes of copper and 220,000 oz of gold
over a mine life of over 20 years. Ore production is shown to be sustainable
based on the detailed mine design carried out by independent external
consultants and benchmarking with other comparable mines.
    Extensive testwork completed by the independent external consultants has
shown average recoveries of 84% gold and 91% copper can be achieved.
Concentrate grades of approximately 26% copper and averaging 26 g/t gold are
    The concentrates will be trucked to Hellas Gold's port storage facility at
Stratoni, which will be approximately 15 km away by road from the proposed
Skouries plant site. Skouries is located on a high plateau with no habitation
in the vicinity.
    The design of the tailings management facility ("TMF") incorporates the
latest paste production technology in a phased TMF that will minimise land
take and embankment height and provides increased tailings stability. The
study shows that the paste tailings are inert. The use of paste tailings and a
phased TMF also allows sequential rehabilitation of the tailings management
facility to minimise active tailings areas.
    Management believes that, based on technical studies to date and taking
into account a stronger Euro versus the US dollar, the project will require
approximately $300 million in initial capital expenditure for the process
plant and associated infrastructure, the tailings management facility, the
open pit and other costs.
    Operating costs for the open pit mining are expected to be 1.28 euro per
tonne, and 6.05 euros per tonne for the underground mining. This translates
into a co-product operating cost ranging between $250 and $300 per gold ounce,
depending on fuel cost and exchange rate assumptions. The Company plans to
publish the results of the final feasibility study on Skouries once the final
Environmental Impact Study is completed.

                          OLYMPIAS PROJECT (GREECE)


    - Market created for gold concentrates - Six-fold increase in sales
      versus 2006
    - Total of 395,000 oz of gold reserves still located on surface
    - Olympias development plan underway

    Market created for gold concentrates - Six-fold increase in sales versus
2006 - The Company's 95%-owned Olympias project benefits from an existing
stockpile of gold-bearing pyrite concentrates which represented, at
31 December 2007, a reserve of approximately 172,000 tonnes grading
23.5 g/t gold (containing 130,000 oz of gold), in addition to substantial
underground reserves of gold, lead, zinc and silver.
    Hellas Gold completed 47 shipments in 2007 (2006 - 9). This translates
into a six fold increase in tonnes of pyrite concentrates sold. Sales of
pyrite concentrates were as follows:

                                                          2007          2006
    Gold concentrate (dry tonnes)                       79,554        11,338

    Also, Hellas Gold received in 2007 payments totalling $6.8 million for the
sale of an additional 69,979 dry tonnes of gold concentrates expected to be
recognised in 2008 and future years, bringing the total of gold concentrates
sold or paid for in 2007 to 149,533 dry tonnes.
    Hellas Gold has now secured the sale of the entire stockpile to six
different purchasers, thereby creating a market for gold concentrates which
did not exist prior to 2006.

    Total of 395,000 oz of gold reserves still located on surface - In
addition the stockpile of gold concentrates, Hellas Gold plans to process
2.4Mt of stockpiled tailings arising from the previous operations at Olympias,
which 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. International
contractor Outotec Minerals OY inspected the facilities in July 2007 and
concluded that the plant could be brought back into efficient operation
quickly and at relatively modest cost.
    Hellas Gold is ready to start reprocessing these tailings and refurbishing
these facilities, and resume underground production as soon as permits are

    Olympias refurbishment plan underway - Olympias is a polymetallic (gold,
lead, zinc and silver) deposit located 8 km north of the Stratoni mine in
northern Greece. The Company's current plan is for development at Olympias to
progress in three phases to allow refurbishment and construction of
infrastructure, a realistic ramp-up in production within the mine and the
subsequent construction of new gold processing facilities at Stratoni. This
staged approach also allows the phasing of capital investment, as follows:

    - Phase 1 has already started, with the sale of the existing stockpile of
      gold-bearing pyrite concentrates located on surface at Olympias.
      Revenues from Phase 1 are intended to fund Phase 2.

    - Phase 2 will consist of reprocessing old tailings at Olympias, which
      will have the added benefit of cleaning up the valley, together with
      underground refurbishment and limited mining in the upper levels of the
      mine. Revenue during Phase 2 will be generated from the sale of
      lead/silver, zinc and gold pyrite/arsenopyrite concentrates.

    - Phase 3 will consist of underground mining initially around the
      existing shaft and other infrastructure. Production of ore is expected
      to ramp up progressively from 200,000 to 900,000 tonnes per annum
      through the expansion of underground infrastructure, which will include
      a new decline from the base of the Olympias deposit for conveying the
      ore to a new centralised concentrator, gold plant and tailings
      management facility at a brown field site to be located in the Stratoni
      mine area. Revenue during Phase 3 will be generated from the sale of
      lead/silver and zinc concentrates and the sale of gold and silver
      bullion produced at the new gold processing plant.

    The phasing of the project allows time for optimisation and development of
the metallurgical process for treating the auriferous arsenopyrite/pyrite
    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 are considered promising for the latter phase.


    Permitting process moving forward - In July 2007, the Company received a
formal letter confirming that the Greek Ministry of Development had completed
its review of the Company's business plan submitted in January 2006 for the
joint development of the Skouries and Olympias gold and base metals projects
in Northern Greece.
    In the letter, the Ministry of Development also re-declared its positive
opinion of the Company's preliminary environmental impact study ("PEIS") which
has already been submitted, and formally requested the Ministry of Environment
to issue its official approval of the PEIS.
    The letter also states that the Ministry of Development "is in agreement
with the development of the project described in the business plan, as this
investment is particularly beneficial to the national and local economy (...)
and reflects the intent of the contract signed between the Greek State and
Hellas Gold".
    This letter is addressed to Hellas Gold and the Ministry of Environment
and represents a statement of support for the projects based on detailed
studies completed by appropriate technical and advisory bodies appointed by
the Ministry of Development. This letter represents the foundation for the
fulfilment of the Company's business plan for Skouries and Olympias, in
compliance with the Greek and EU legal framework.
    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
three phases to allow refurbishment of existing infrastructure and the
subsequent construction of new gold processing facilities at Stratoni.
Skouries will initially be mined as a low strip open pit operation, followed
by highly productive underground mining.
    The Company is currently finalising a full environmental impact study
("EIS") which is expected to be submitted to the Greek government in the
second quarter of 2008, addressing any comments received on the PEIS which are
expected within the next few weeks. On approval of the EIS, the environmental
permits for Skouries and Olympias are expected to 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 survey outlines intrusive belt; progress in target definition -
Hellas Gold holds 317 km2 of highly prospective licences in northern Greece
over which an airborne geophysical survey was completed by Fugro Airborne
Surveys in December 2007. Twenty targets had already been identified from
existing data; however, the survey represents the first systematic modern
exploration ever been conducted over the licence area. The survey comprises
magnetics and radiometrics over the entire licence area and an electromagnetic
("EM") survey over the northern part of the licence area, which is host to
massive sulphide targets.
    Early processing of the magnetics has defined an intrusive belt some 17 km
by 6 km in the South-East part of the licence area. This clearly defines known
porphyry deposits at Skouries and at the previously identified Fisoka target.
Fisoka is shown by the geophysics to comprise three porphyry bodies. The
northern body was drilled historically with grades of between 0.4% and 0.65%
copper over widths of 20 to 81 metres and no gold analyses. Ground truthing
has shown that the central area shows the most intense veining with copper
oxides visible at surface. Re-analysis of stream sediment sampling has shown
that the more anomalous samples were in stream draining from the central area.
These factors indicate that the untested central and southern Fisoka
porphyries offer the best potential. Hellas Gold plans to drill test the
central and southern Fisoka porphyries later this year.
    The magnetics have also highlighted a series of strong anomalies, similar
in magnitude to Skouries, over a 3 km by 4.5 km area, which is believed to
represent a complex of intrusives some 3 km to the South-East of Skouries
which will be investigated on the ground in the next few weeks.
    The raw EM data indicated conductors over the known massive sulphide
orebodies, including the Olympias look-alike massive sulphide target at
Piavitsa. Post processing of the EM will be used to confirm continuity of the
Piavitsa mineralisation along its 2 km strike length prior to drill testing in
the second half of 2008.
    The fully processed geophysics will also be used to prioritise the
remainder of the twenty identified targets and develop new ones over the
licence area.

                           CERTEJ PROJECT (ROMANIA)


    - Key feasibility studies completed to high accuracy level
    - Reserves increased by 20% - Life-of-mine extended by two years
    - Environmental Impact Study completed - Permitting process well underway
    - Continuing exploration programme

    Key feasibility studies completed to high accuracy level - European
Goldfields is in the final stage of completing a full feasibility study for
its 80%-owned Certej project, located within a mining district in Romania
known as the "Golden Quadrilateral". In 2007, European Goldfields completed
feasibility level studies to a high level of accuracy of +/-15% on the open
pit mine design, the processing plant and the tailings management facilities
    RSG Global Consulting Pty Ltd ("RSG Global") completed a pit optimisation
and pit design study, which included a geotechnical drilling programme
designed by Golder Associates. The study resulted in a better conversion from
resources to reserves and confirmed that the deposit will be mined with an
open pit 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. This 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.
    The metallurgical process involves 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 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 second phase of the continuous Albion and CIL pilot plant trials have
been completed and Aker Kvaerner Engineering Services has now finalised an
engineering and cost study for the processing plant and associated
infrastructure to an accuracy of +/- 15%.
    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 has completed a design and cost
study for the TMFs.

    Reserves increased by 20% - Life-of-mine extended by two years - In
October 2007, European Goldfields announced a 20% increase in gold reserve
ounces for the Certej project, reported as follows under Canadian National
Instrument 43-101:

                                               Au       Au       Ag       Ag
    Reserve Category      Million Tonnes      g/t      Moz      g/t      Moz
    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. It is based on the generation of
a gold-bearing concentrate followed by the production of gold and silver as
doré on site by means of the Albion Process.

    Environmental Impact Study completed - Permitting process well underway -
In February 2008, European Goldfields completed the final Environmental Impact
Study (the "EIS") to develop the Certej project, which is expected to be
submitted to the Romanian environmental authorities in Timisoara by the end of
March 2008. This follows the submission of a Technical Feasibility Study to
the Romanian authorities in March 2007 and the grant by the local county
council of a General Urbanisation Certificate in September 2006. This
certificate confirms the designation of Certej as an industrial mining area
and attests to the local community's support for the project.
    European Goldfields already holds a mining permit for Certej, which is
currently being exploited on a small scale by way of an existing open pit. The
EIS addresses a proposed increase in mine production at Certej and the
processing of ore on site.
    The EIS has been carried out over a 12-month period in order to accumulate
all the required base line data during the different seasons. The EIS is a
detailed multi-discipline study comprising over 2,000 pages subdivided into a
number of volumes assessing the environmental, social and health impacts of
the project on the mine area.
    The EIS was prepared with the contribution of several Romanian institutes
of international reputation, namely the National Institute of Research and
Development for Industrial Ecology (ECOIND), the National Institute of
Research and Development for Environment Protection (ICIM), the Technical
University of Construction Bucharest and the Babes-Bolyai University of Cluj.
The EIS was prepared to the regulatory framework established by Romanian and
EU legislation.
    The environmental permit and an updated mining permit are expected in Q4
2008 following a standard public consultation process with local communities,
which is expected to start 45 days after submission of the EIS. Customary
construction and public utility permits are expected to follow by end-2008
when the detailed engineering design has been completed for the site plant.

    Continuing exploration programme - Ongoing exploration activities in
adjacent concessions to Certej are aimed at increasing satellite resources to
provide extension to life of mine or higher grade feed to the Certej
operation. This will include step out exploration over satellite resources to
investigate strike and down dip potential. As part of an ongoing generative
programme, satellite image and pilot geochemical programmes over known
mineralisation are currently being carried out. This will enable exploration
to focus activities along structures that were active during the mineralising
    European Goldfields has pending applications for new exploration licences
in the "Golden Quadrilateral" area of West-central Romania where the Certej
deposit is located. The applications cover complex geological terrains that
host significant epithermal, porphyry and volcanogenic massive sulphide (VMS)
mineralisation. Remote sensing surveys and mapping are proposed over the
concessions combined with geochemical surveys using results of the above
mentioned pilot studies in order to define the exact methodology. The aim of
the programme is to generate high quality targets that represent significant
mineralised systems that can be drill tested in 2009.

    Documents 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
2007, and copies of the Notice of Meeting and Management Proxy Circular for
the Annual Meeting of shareholders of the Company to be held on 19 May 2008
have been sent to shareholders and filed on SEDAR at

    Director's shareholding

    The Company approved the grant on 20 March 2008 of 40,000 restricted share
units ("RSUs") to Philip Johnson, a director of the Company, under the
Company's Restricted Share Unit Plan. Such RSUs will be redeemed into an equal
number of Common Shares of the Company on 19 May 2008, from which the Company
will withhold 16,800 shares for tax purposes and sold in the public market. As
a result, Philip Johnson will hold 37,200 Common Shares of the Company
representing 0.02% of the issued share capital of the Company.

    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:; Jason
Roy,; Josh Rivard,;
Media - François Trépanier,; (514) 939-3989,
Fax: (514) 939-3717; RBC Capital Markets: Andrew K Smith,, +44 (0)20 7029 7882

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