Results for Q2 2007 - Best quarterly results to date - Substantial growth in reserves and cash balance

    WHITEHORSE, YT, Aug. 8 /CNW Telbec/ - European Goldfields Limited
(AIM: EGU / TSX: EGU) ("European Goldfields" or the "Company") today reports
its results for the second quarter to 30 June 2007. Highlights are:

    Corporate highlights

    - Acquisition of an additional 30% interest in Hellas Gold at an
      accretive price
    - Strategic alliance with Aktor and its parent company Elliniki
    - C$138 million equity financing completed in the period

    Financial highlights:

    - Sales increased by 142% to US$42.0m in H1 2007, compared to $17.4m in
    - Profit (before tax) of $16.6m in H1 2007, compared to $1.3m in 2006
    - Operating cash flow increasing to $19.0m in H1 2007, up $14.5m over
    - Working capital of $211.6m at 30 June 2007, compared to $36.5m in 2006

    Operational highlights:

    - Stratoni: Grades higher than expected
    - Skouries & Olympias: Ministry of Development completes review of
      business plan - Significant milestone for permits
    - Skouries: Contract signed with Outotec Minerals OY for the purchase of
      mill and plant equipment
    - Olympias: Refurbishment plan underway
    - Certej: Pilot scale continuous test confirmed 90% gold recovery using
      the Albion Process
    - Certej: New mineralisation discovered in open pit

    Commenting on the results, David Reading, Chief Executive Officer of
European Goldfields, said: "These results demonstrate that European Goldfields
is on track to become a mid-tier producer. The successful financing and the
alignment of shareholder interests, combined with growing production and
profitability underpin the Company's strategy of generating excellent and
sustainable returns for investors.
    "We are also pleased with the permitting process for our gold projects
with a further step completed in the period. European Goldfields is now well
placed to unlock the further value from these projects with its strategic
partner Aktor and realise the value of our reserves for our new and existing

    Conference Call & Webcast - 8 August 2007 at 10am EST / 3pm GMT

    European Goldfields will host a conference call on Wednesday 8 August 2007
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 dialing one of the three
following numbers, approximately 10 minutes before the start of the call.

    From North America: (Local) 416-644-3423 or (toll free): 1-800-589-8577
    From the U.K. & France (toll free): 00-800-0000-2288
    From Austria, Belgium, Denmark, Germany, Ireland, Iceland, Netherlands,
    Norway, Sweden, Switzerland and Italy (toll free): 00-800-0022-8228

    A live audio webcast of the call will be available on:

    For those unable to join the live conference call, a replay will be
available until 15 August 2007 at midnight by dialing (toll free)
1-877-289-8525 or 1-416-640-1917, Passcode 21241908#.

                           SELECTED FINANCIAL DATA

                                Three months ended          Six months ended
                                      30 June                   30 June
    (in thousands of           ----------------------------------------------
    US dollars, except           2007         2006         2007         2006
    per share amounts)              $            $            $            $
    Statement of loss
     and deficit
    Sales                      24,944        8,274       42,027       17,357
    Gross profit               14,949        4,330       25,088        8,625
    Profit before income
     tax                       10,925          252       16,600        1,289
     after income tax           8,129         (311)      12,085         (150)
    Non-controlling interest   (2,794)        (225)      (4,642)        (700)
    Profit/(loss) for the
     period                     5,335         (536)       7,443         (850)
    Earnings/(loss) per share    0.04         0.00         0.06        (0.01)

                                      30 June 2007          31 December 2006
    (in thousands of US dollars)                 $                         $
    Balance sheet
    Working capital                        211,637                    41,854
    Total assets                           729,774                   311,943

    European Goldfields' unaudited interim consolidated financial statements
and management's discussion and analysis for the three- and six-month periods
ended 30 June 2007 and 2006 are filed on SEDAR at

                             CORPORATE ACTIVITY

    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 US$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 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 US$8.4 million in cash.
    This transaction was, in essence, a share swap and reinforces a strategic
alliance with Aktor S.A. ("Aktor") and its parent company Elliniki
Technodomiki TEB A.E. (ATHEX: ELTEX) ("El-Tech") in that approximately 95% of
the purchase price was paid to Aktor in common shares of the Company. Of the
cash portion, 50% will be re-invested by Aktor into Hellas Gold, as funding
towards maintaining its residual 5% shareholding interest in Hellas Gold.
    El-Tech is a large Greek conglomerate with a market capitalisation in
excess of US$2 billion and investments in four fields: construction,
concessions, energy and real estate. Aktor is Greece's largest construction
    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

    Cdn$138 million equity financing - 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.

    Attractive price secured on Stratoni silver stream sold to Silver
Wheaton - 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 lead-zinc
    The sale was made in consideration of a prepayment to Hellas Gold of
US$57.5 million in cash, plus a fee per ounce of payable silver to be
delivered to Silver Wheaton of the lesser of US$3.90 (subject to an
inflationary adjustment beginning after year three) and the prevailing market
price per ounce. The current Stratoni proven and probable silver reserve
contains approximately 12 million ounces of silver.
    The deal amounts to $11.59 of revenue per payable reserve ounce of silver,
compared to the current silver spot price of $13.14/oz. On a discounted basis
(at 10%), this amounts to $10.39/oz of payable silver reserve, compared to the
current discounted silver spot price of $10.34/oz.
    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 Hellas Gold's other mine of
Olympias, except for a right of first refusal granted to Silver Wheaton on
similar future transactions over the Company's silver assets.

                         STRATONI OPERATIONS (GREECE)


    - Better grades achieved
    - Development for continued production ramp-up in 2007
    - New mineralisation discovered at Stratoni

    Consistent production from Stratoni - Hellas Gold mined a total of
53,088 tonnes of ore in the second quarter of 2007 and 108,157 tonnes during
the first half of 2007 at its Stratoni mine, which represents the best
half-yearly production to date from the Stratoni mine and mill. Hellas Gold
completed eight shipments of concentrates from Stratoni in the second quarter
of 2007 and 13 shipments in the first half of 2007. This translates into the
following sales of concentrates:

                              Q2 2007      Q2 2006      H1 2007      H1 2006
    Ore mined (wet tonnes)     53,088       47,966      108,157       79,718
    Zinc concentrate (tonnes)  14,007        5,513       22,251       10,796
    - Containing payable:
       Zinc (tonnes)(*)         5,855        2,320        9,318        4,655
    Lead concentrate (tonnes)   5,651        2,337        9,425        6,960
    - Containing payable:
       Lead (tonnes)(*)         3,636        1,554        6,122        4,720
       Silver (oz)(*)         285,349      121,350      475,641      373,909
    Inventory (end of period)
    Ore mined (wet tonnes)      4,603       12,326        4,603       12,326
    Zinc concentrate (tonnes)       2        1,562            2        1,562
    Lead/silver concentrate
     (tonnes)                   2,150          674        2,150          674
    (*) Net of smelter payable deductions

    Ore production rates from underground have steadily increased from
400 tonnes per day in the first half of 2006 to a steady 850 - 900 tonnes per
day in the first half of 2007 and the mine now operates effectively at these
levels. The rate of ore production is expected to continue to increase up to
the end of 2009. This expected increase is supported by the current
development plan and the new decline which is scheduled for completion by end
of 2007.

    Better grades achieved - Mined grades have continued to be in line with
the high levels experienced in the first quarter of 2007. On average, mined
and processed grades have been on average approximately 18% higher than
reserve grades in the first half of 2007. As a result, concentrate production
and sales are at high relative levels.
    Forecast ore production for 2007 has been reduced by approximately 10%
from the originally forecasted 250,000 tonnes due to bad ground conditions in
the upper area of the mine, reducing the access to faces required for expanded
operations. However, this is not expected to affect forecast metal production
as grades have been significantly higher than expected in 2007.

    Development for continued production ramp-up in 2007 - An internal ramp to
access the upper parts of the mine is on-going and is providing access to new
working ends in the upper part of the mine to ensure the ramp-up in production
continues in 2007. The new decline to the Mavres Petres orebody, critical to
future production ramp-ups and ventilation, is over 1,400 metres and advancing
    The two filter presses designed to maximise the utilisation of storage
space for fine tailings will be commissioned in the third quarter of 2007. The
backfilling of old mine workings with coarse tailings to create additional
tailings storage space on surface has resulted in a total of some 20,000 m3 of
void in the old Madem Lakkos mine workings being filled to date. This
backfilling should also reduce mine water pumping and treatment costs. The
second water treatment plant at the Stratoni mine site is scheduled to be
commissioned in the third quarter of 2007 to improve efficiency and provide
capacity for extreme rainfall events.

    New mineralisation discovered at Stratoni - New mineralisation has been
encountered during the excavation of the new decline running between the
existing reserve and mined-out areas at Madem Lakkos. Average grades from
panel sampling compare favourably with current reserves. A drill programme
designed to define at least 200 metres of strike and 75 metres of dip extent
has commenced with results expected in the fourth quarter of 2007. The new
decline will enable immediate access for mining of any new discovery in this

    Drilling of Stratoni extensions - In October 2006, European Goldfields
began an exploration drilling programme at Stratoni with the aim to
significantly increase reserves and life of mine. The two targets being
investigated first are known extensions to previously mined areas of the
Stratoni (Madem Lakkos) deposit, where production grades of 9.0 to 10.7% lead,
9.0 to 9.6% zinc and 160.0 to 185.3 g/t silver are recorded. Drilling to date
has confirmed to date the geological model.
    The drilling programme will also investigate the inferred resources
previously reported for Stratoni (see the Company's press release of 8 January
2007), which form extensions to the western deposit at Stratoni (Mavres
Petres). The drilling programme is designed to upgrade these inferred
resources to the measured and indicated categories. These inferred resources
are extrapolations from the known reserves and comprise some 555,000 tonnes
grading 7.3% lead, 10.2% zinc and 181 g/t silver.



    - Sales of Olympias gold concentrate on track
    - Olympias refurbishment plan underway
    - Contract signed for purchase of mill and plant equipment
    - Ministry of Development completes review of business plan

    Sales of Olympias gold concentrate on track - Hellas Gold's Olympias
project benefits from an existing stockpile of gold-bearing pyrite
concentrates representing, at December 31, 2006, a reserve of approximately
252,000 tonnes grading 23.3 g/t gold (containing 188,000 oz of gold), in
addition to substantial underground reserves of gold, lead, zinc and silver.
    Hellas Gold completed eight shipments of gold concentrates from the
Olympias stockpile in the second quarter of 2007 and 18 shipments in the first
half of 2007. This translates into the following sales of concentrates:

                              Q2 2007      Q2 2006      H1 2007      H1 2006
    Gold concentrate
     (dry tonnes)              12,686        1,905       29,776        1,905

    Hellas Gold has secured to date the sale of a total of 209,000 wmt of
Olympias concentrates (containing approximately 148,000 oz of gold) over a
three year period to four different companies - Golden China Resources
Corporation (formerly Shandong MIC Biogold Ltd.), MRI Trading AG, Opeloak
Limited (a subsidiary of Celtic Resources Holdings Plc) and Euromin S.A. -
with expressions of interest to sell up to an additional 132,000 wmt of
concentrates if the initial shipments are successful. Hellas Gold expects to
sell a total 100,000 tonnes of gold concentrates in 2007 under the terms of
these agreements.
    Hellas Gold plans to resume underground mining operations at Olympias
after permits are awarded, producing more gold bearing pyrite concentrates for
sale to existing and new off-take purchasers.

    Olympias refurbishment plan underway - Preliminary work has already been
initiated to realise the start-up at Olympias. The main mine infrastructure
consisting of ventilation, dewatering and hoisting are all operable and entry
to the workings is available from the existing ramp. An engineering audit of
the underground mine facilities has been completed and will be put into effect
once permission to proceed is received. Similarly, the fabric of the existing
concentrator is sound. An audit of the plant has been undertaken and the
international contractor Outotec Minerals OY inspected the facilities in July
2007 and concluded that the plant could be brought back into efficient
operation at relatively modest cost.
    It is firstly planned to reclaim and process the 2.4Mt of stockpiled
tailings arising from the previous operations at Olympias. This material will
be fed into the plant either alone or blended with mined ore and will produce
the gold bearing pyrite concentrate similar to that which is already being
sold. The residue from the concentrator plant will be directed to a backfill
plant where the course fraction will be mixed with a small quantity of cement
and used to fill the underground voids at Olympias; the fine fraction will be
filtered and the dried product transported for storage at the tailings
management facility at the nearby Stratoni mine. In this way, the environment
will be improved at the Olympias site and all future tailings managed in a
responsible manner utilising best practice.

    Skouries technical feasibility study nearly completed - Hellas Gold has
completed most technical studies for the final bankable feasibility study on
its Skouries gold-copper project. 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
    - Mining studies undertaken by SRK Consulting, Scott Wilson Mining and
      other international consultants.

    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. This production rate is shown to be
sustainable based on the detailed mine design carried out by independent
external consultants and benchmarking with other comparable mines.
    Outstanding work on the bankable feasibility study consists of the
incorporation of the environmental impact study and minor optimisation studies
on landtake positioning around the open pit, water diversion and costs in the
open pit.

    Contract signed for purchase of mill and plant equipment - Hellas Gold has
signed a contract with Outotec Minerals OY for the purchase of mill and plant
equipment. Hellas Gold is also negotiating with Aktor S.A. for the
construction of the plant and related infrastructure after permits are
received. In June 2007, a deposit of (euro)6 million was paid to secure the
fabrication of the primary SAG and ball mills and for Outotec to commence with
basic design. A testwork programme has been agreed with Outotec and will be
carried out at their laboratory in Finland during August 2007. The programme
is aimed at optimising the gravity gold recovery and dore production system,
and establishing basic design criteria for the concentrate regrind mill, the
concentrate thickener and filter.

    Ministry of Development completes review of business plan - In July 2007,
Hellas Gold received a formal letter confirming that the Greek Ministry of
Development had completed its review of Hellas Gold'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 Hellas Gold'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 Hellas Gold'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. Hellas Gold'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.
    This letter from the Ministry of Development re-confirms an earlier
statement made by the General Secretary of the Greek Ministry of Development,
Mr Nikos Stefanou, when he publicly stated that the Government of Greece fully
supports the development of mining projects in Chalkidiki, the region where
the Skouries and Olympias projects are located. In his speech, Mr Stefanou
stated that "The mining industry is extremely important for the regional
development of Greece" and more specifically that "The government supports the
development of the gold mining business in Chalkidiki, according to the
environmental framework. The execution of this initiative will develop this
region and provided work for 600 people in the construction phase and
1300 people in the production." The speech was made on 10 May 2007 in Athens
and is available at
    Hellas Gold is currently finalising a full environmental impact study
("EIS") which is expected to be submitted to the Greek government in the
fourth quarter of 2007, addressing any comments received on the PEIS. On
approval of the EIS, the environmental permits for Skouries and Olympias are
expected to be issued.
    Hellas Gold 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.

    Permit-wide exploration under way - Twenty exploration targets
identified - Hellas Gold holds 317 km2 of highly prospective exploration
licences in northern Greece. Recent work by Hellas Gold has highlighted a
total of twenty exploration targets, including six advance targets and
extensions to known deposits, seven targets of known mineralisation for
follow-up work and seven conceptual targets.
    A programme of mapping, reinterpretation and modelling has been undertaken
on the Piavitsa advanced target. This polymetallic massive sulphide target
comprises a 6 km mineralised structure with a 3.5 km central zone expressed by
old manganese oxide open pits. Within the zone, seven holes drilled by the
previous owners over 1,300 metres of strike length and some 500 metres of
known down dip extent define three mineralised horizons averaging 12 metres
width including high grade zones averaging around six metres width. Grades
within the intercepts ranged from 0.3 to 22.2 g/t gold, 0 to 533 g/t silver, 0
to 26% zinc and 0 to 12% lead. The current programme has confirmed the
potential of the Piavitsa target over a three kilometre strike length and has
identified a high grade shoot within the main horizon. The work also
identifies previously unsampled horizons of potential economic mineralisation
and points to the possibility of further high grade shoots at depth. These
targets will be tested with geophysics in the second half of 2007 and
subsequently drilled out.
    Pilot ground-based geophysical programmes have now been completed over
known mineralisation at Olympias and have proven the effectiveness of EM
geophysical surveys over areas that are prospective for massive sulphide
mineralisation. On the basis of these results, Hellas Gold plans to fly
airborne magnetic surveys over the entire licence block and airborne EM
surveys over the massive sulphide belts in October 2007. The airborne surveys
are aimed at identifying new target areas and prioritising these with existing
targets in preparation for drilling in 2008.

                           CERTEJ PROJECT (ROMANIA)


    - Technical feasibility study submitted
    - Albion Process Technology achieved 90% gold recovery in continuous
      pilot plant tests
    - New mineralisation discovered in open pit

    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 its 80%-owned Certej project.
    The Certej reserve for the sale of concentrates contains 27.7 million
tonnes of ore grading 2.0 g/t gold and 11.6 g/t silver, representing
1.76 million ounces of gold and 10.4 million ounces of silver. The deposit
extends from surface and will be mined by open pit methods with a strip ratio
of 3.4:1. The project will involve the mining and processing of 3.0 million
tonnes of ore per annum over at least nine years.
    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 translates into an annual planned
production of approximately 168,000 oz of contained gold in the concentrate.
The flotation concentrate will then be directed to the Albion Process section
of the plant for recovery of gold and silver as doré. 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 process.
    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. 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 unresponsive to 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 two 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
("Certej EIS"), which is due for completion in the third quarter of 2007 after
some contributory studies are finalised. The Certej 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 Certej EIS is a detailed multi-discipline study
assessing the environmental, social and health impacts of the project on the
affected area.

    Final bankable feasibility study to be completed by end-2007 - Once the
EIS is completed, European Goldfields expects to complete a bankable
feasibility study ("BFS"), which will be used for internal approval and
presentation to banks and other sources of potential financing of the project.
The BFS is scheduled for completion by the end of the fourth quarter of 2007.
    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.
    The BFS will include a final open pit optimisation study, which will take
into account the latest testwork and the effect on assessing ore extraction
and processing economics and include the positive results of the completed
infilling drilling programme to convert inferred resources within the pit area
to the indicated category (see table below). Conversion of inferred resources
is expected to provide an additional year of feed to the Certej plant.

    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 third 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 Certej.
    All mining permits and a detailed urbanisation plan are expected by
mid-2008 following a standard public consultation process with the local

    New mineralisation discovered in open pit - Exploration in Romania has
focused on extending the life-of-mine of the Certej project. This comprises
drilling out inferred resources and deeper, potentially high grade feeder
zones, in-fill drilling and metallurgical testwork on satellite deposits,
investigation of high grade vein deposits near to the project that could
increase the feed grade in the early project life and the development of
targets that could enhance the value of concentrates produced, by the addition
of copper rich material for example. Drilling to convert inferred resources
(currently treated as waste where they fall in the open pit) to the indicated
category has now been completed.
    In May 2007, European Goldfields announced that significant drilling
intercepts have been encountered at Certej. In July 2007, European Goldfields
completed a diamond and RC drilling campaign on the Certej deposit comprising
29 holes for some 3,492 metres. The drilling programme was designed to convert
inferred resources within the current pit design to the indicated category and
to test the link structure. To date results have been received for all of the
29 holes and significant intercepts are as follows:

                    From       To       Width         Au       Ag
    Hole ID      ----------------------------------------------------   Zone
                      (m)      (m)         (m)      (g/t)    (g/t)
    CJSD282           14       24          10        1.8        4     West_N
    CJSD284           11       17           6        9.7        2     West_S
    Inc               11       12           1       55.4        2
    "                 37       68          31        6.7        6
    Inc               48       51           3       51.8       30
    "                 74       82           8        2.9        4
    "                 92       96           4        1.6      192
    CJSD285           96      108          12        1.5       55     West_S
    CJSD286(RC)      122      126           4        1.9        1        Int
    CJSD287(RC)      113      114           1       39.3        1        Int
    CJSD290            3        7           4       12.3        4     West_N
    Inc                4        7           3         16        4
    CJSD291(RC)      146      158          12        2.1       25   Link Str.
    Inc              157      158           1       12.8        2
    "                171      196          25        1.7        3   Link Str.
    Inc              178      180           2        7.1        6
    "                376      414          38        1.7        8
    CJSD292           38       70          32        2.4       15     West_S
    "                 79       99          20        3.3       91
    CJSD296            0       24          24        1.6        2     West_N
    "                 54       66          12        1.5        8
    CJSD297           30       36           6        1.5       14     West_N
    "                 46       56          10        4.7      169
    Inc               46       49           3        8.5      487
    CJSD298           10       30          20        1.6        4         NW
    CJSD299           69       84          15        2.2        3         NW
    "                 82       84           2        6.2        2
    CJSD300           21       22           1        7.8      145         NW
    "                 44       48           4        1.6        4
    CJSD301            0        5           5        2.6       15     West_S
    "                 13       34          21        1.8       15
    "                 61       66           5        1.8       28
    CJSD303           82       87           5        1.9        1     West_S
    CJSD305           43       45           2        5.1       81     West_N
    Inc               43       44           1        8.8      132
    CJSD306           52       56           4        1.8        1     West_N
    "                 75       83           8        1.8        3
    CJSD307            8       10           2        5.1       19     West_N
    Inc                8        9           1          9       33
    "                 89       96           7        1.6        5
    CJSD308           38       40           2        1.5        5     West_S
    CJSD309           60       66           6        1.8       23     West_S
    "                 70       75           5        1.6       32

    Results are quoted using a 1.0 g/t Au lower cut-off grade, no upper grade
cut being applied, and include a maximum of 5 m consecutive internal waste.
Only intercepts equal to or greater than 1.5 g/t Au are reported. The Certej
deposit is irregular in nature, however drilling has been conducted
perpendicular to mineralisation wherever possible and as such drilled widths
correspond to true widths. Unless otherwise indicated, the intercepts reported
above are from half HQ size diamond core and the holes are sampled at
one-metre intervals throughout the entire hole.
    High gold grade drill intercepts from the southern flank of the West Zone
represent a zone of intense potassic and variably silica altered andesite
which trends southwest and is open along strike and down dip. The drilling
confirmed the inferred resources and also identified these additional higher
grade mineralised zones in the western part of the deposit. The results are
currently being assessed and a new resource calculation will be completed
later in 2007 followed by a revised pit optimisation and reserve estimation.
    Sample preparation and analysis was carried out at the independent ISO
Certified ALS-Chemex Laboratory at Gura Rosiei, Romania, using industry
standard fire assay techniques for gold on 50-gram sample charges with atomic
absorption spectrometry ("AAS") finish and aqua regia digest for silver with
an AAS finish. In addition to the laboratory's standard quality assurance /
quality control ("QAQC"), the Company submits field duplicates, crusher
duplicates, pulp duplicates and known gold standards on a routine basis and
these comprise approximately 20% of submitted samples.

    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 2006, 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: please contact: European Goldfields: David
Reading, Chief Executive Officer, Office: +44 (0)20 7408 9534,; RBC Capital Markets: Patrick Meier; Peter
Barrett-Lennard, Office: +44 (0)20 7653 4093; Evolution Securities: Simon
Edwards; Neil Elliot, Office: +44 (0)20 7071 4300; Buchanan Communications:
Bobby Morse; Ben Willey, Office: +44 (0)20 7466 5000,;
Renmark Financial Communication: Neil G. Murray-Lyon,; Barbara Komorowski,; Media - Eva Jura,, Office: (514) 939-3989, Fax: (514) 939-3717,

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