25th Jan 2006 14:55
European Goldfields Ltd25 January 2006 For Immediate Release 25 January 2006 European Goldfields Limited CERTEJ PROJECT MOVING FORWARD European Goldfields Limited (AIM: EGU / TSX: EGU) is pleased to release thefollowing update on its 80%-owned Certej project in the Southern ApuseniMountains of Romania. Highlights are: • In-house pre-feasibility study completed in 2005 • Comprehensive flotation metallurgical studies completed, confirming production of high grade gold/silver concentrate • Level 1 Environmental Impact Assessments (EIA) completed • Letters of interest received for Certej gold/silver concentrate • Positive exploration results on Certej satellites • Work in progress: - Level II EIA and Environmental Impact Study - Metallurgical studies on process route for producing gold dore on site; first stage test work completed - Pit optimisation work, based on geotechnical drilling completed in January - Technical report converting current Certej resources into reserves Commenting on the Certej project, David Reading, Chief Executive Officer ofEuropean Goldfields, said: "Following commencement of production at our Stratoni mine in Greece, EuropeanGoldfields continues to develop its portfolio of assets. We are making steadyand significant progress on our Certej project. We look forward to convertingresources to reserves in March and thereafter setting out a clear roadmap topermitting and project development". In-house pre-feasibility study completed - In July 2005, European Goldfieldscompleted an in-house pre-feasibility study on the Certej project. The study hasresulted in: - Confirmation that a concentrate can be produced with high grades - An open pit with low strip ratios - The definition of sites for infrastructure and tailings disposal - A clear understanding of all work required to complete an environmental impactassessment and achieve all necessary permitting. It is envisaged that the project could mine and process 3.0 Mt per year over atleast eight years, following the pit optimisation work currently in progress. Atthe proposed production rates, this would yield approximately 252,000 tonnes ofconcentrate per year with grades averaging 20 g/t gold and +130 g/t silver, witha flotation gold recovery of about 87.2%. Environmental studies under way - European Goldfields plans to complete thenecessary Environmental Impact Assessments (EIA Levels I and II) and anEnvironmental Impact Study (EIS) and to apply for the necessary planning permitslater in 2006. ECOIND, a Romanian company who have a well-proven track record inenvironmental research and permitting procedures, have been employed to carryout this work. The EIA Level I was completed in December 2005 and work hascommenced on the EIA Level II. This will be followed by the EIS in order toprogress to full feasibility study, permit application and project development. Letters of interest received from traders - European Goldfields received lettersof interest from two East European metal traders indicating their willingness tonegotiate the purchase of all the high grade gold/silver flotation concentratesto be produced at Certej. The terms received confirm that the sale ofconcentrates would support the necessary capital investment and produce a viablereturn for the Certej project at a gold price above $425/oz. On-site production of gold dore being investigated - European Goldfields is alsoactively reviewing other development options to progress the project forward,such as confirming a process route for producing gold dore on site. Of the available techniques, the Albion Process followed by cyanidation isconsidered the most promising. The Albion process is a combination of ultra-finegrinding and oxidatative leaching at atmospheric pressure. Samples of flotationconcentrates produced from the locked-cycle test work at SGS-Lakefield wererecently tested at Hydrometallurgical Research of Australia. Initial resultsindicate that a flotation concentrate produced from Certej ore can be processedby the Albion Process to produce gold dore on site. Additional test work and acost analysis are underway. Final pit optimisation in progress - The in-house pre-feasibility studyindicated that 22.5 Mt could be economically mined by open pit methods at agrade of 2 g/t gold and 10 g/t silver. Golder Associates (Golders) of the UKhave been engaged to complete a geotechnical study for slope angles for thefuture Certej open pit. An eight hole geotechnical drilling program designed byGolders was completed in January 2006. A slight increase in overall wall anglewould improve the strip ratio and allow additional +2g/t gold material to bemined at the base of the current pit design. RSG Global of Australia are thenexpected to complete a final pit optimisation based on Golders' work, EuropeanGoldfields' resource estimates and the recent "mapping" of the various recoveryzones. Ongoing exploration - The Certej deposit hosts measured and indicated resourcesof 31.4 Mt grading 2.1 g/t gold and 11 g/t silver. Further exploration work inRomania is now focused on defining additional resources to add to the openpitable resources at Certej (approximately 22 Mt) and extend the life of mine ofthe project. European Goldfields has identified a number of satellite targetswhich comprise open pitable mineralisation within the Certej licence area andthe adjacent Baita-Craciunesti licence area. In addition, surface dumps arebeing evaluated for their tonnage grade and metallurgical characteristics. Asannounced on 5 December 205, preliminary drilling results are encouraging. Resources & Reserves Parameters For additional information on the resource and reserve estimates for theCompany's projects, please refer to the Company's Resources & ReservesDeclaration at www.egoldfields.com/goldfields/resources.jsp. About European Goldfields European Goldfields Limited is a resource company involved in the acquisition,exploration and development of mineral properties in Greece, Romania and theBalkans. Greece - European Goldfields holds a 65% interest in Hellas Gold S.A. HellasGold owns assets in Northern Greece which consist of three deposits within70-year mining concessions covering a total area of 317 km(2). The depositsinclude the polymetallic projects of Stratoni and Olympias which contain gold,lead, zinc and silver, and the copper-gold porphyry body referred to asSkouries. All three deposits have been well defined with over 200,000 metres ofdrilling and the completion of feasibility studies and later engineeringstudies. The total proven and probable reserves of these assets are 17.2 Moz on a goldequivalent basis (65% attributable = 11.2 Moz) from a measured and indicatedresource base of 21.8 Moz gold equivalent (65% attributable = 14.2 Moz). These assets represent some of the largest defined deposits in Europe. The threedeposits are located within a 10 km radius of each other, making thiseffectively a gold and base metals centre. Furthermore, both Stratoni andOlympias were previously in production and have extensive existing mining andplant infrastructure and a ship loading facility on the Aegean Sea. HellasGold's assets also include potential revenue generating stockpiles and tailingslocated on the surface. In September 2005, Hellas Gold resumed production at Stratoni following theaward by the Greek state of all necessary environmental and mining permits.Production of ore is expected to reach 170,000 tonnes by the end of the firstyear of production, steadily increasing to 400,000 tonnes per annum by yearfive. Hellas Gold is in the process of applying for similar permits for Olympiasand Skouries. Romania - European Goldfields holds five mineral properties located within the"Golden Quadrilateral" area of Romania, where it has recently completed anin-house pre-feasibility study underpinning the value of its 80%-owned Certejdeposit. The Certej deposit hosts measured and indicated resources of 31.4 Mtgrading 2.1 g/t gold and 11 g/t silver for 2.34 Moz of gold equivalent (80%attributable = 1.88 Moz). For further information please contact: European Goldfields: David Reading, Chief Executive OfficerDavid Grannell, Chief Financial OfficerOffice: +44 (0)20 7408 9534 e-mail: [email protected]: +44 (0)7703 190 652 website: www.egoldfields.com Buchanan Communications:Bobby Morse / Ben Willey e-mail: [email protected]: +44 (0)20 7466 5000Mobile: +44 (0)7802 875 227 The Sherbourne GroupForbes West e-mail: [email protected]: +1 416 203 2200 Forward-looking Statements Certain information included in this document, including any information as tothe Company's future financial or operating performance and other statementsthat express management's expectations or estimates of future performance,constitute "forward-looking statements." The words "expect", "will", "intend","estimate" and similar expressions identify forward-looking statements.Forward-looking statements are necessarily based upon a number of estimates andassumptions that, while considered reasonable by management, are inherentlysubject to significant business, economic and competitive uncertainties andcontingencies. The Company cautions the reader that such forward-lookingstatements involve known and unknown risks, uncertainties and other factors thatmay cause the actual financial results, performance or achievements of theCompany to be materially different from its estimated future results,performance or achievements expressed or implied by those forward-lookingstatements and the forward-looking statements are not guarantees of futureperformance. These risks, uncertainties and other factors include, but are notlimited to: changes in the worldwide price of gold, base metals or certain othercommodities (such as fuel and electricity) and currencies; ability tosuccessfully integrate acquired assets; legislative, political or economicdevelopments in the jurisdictions in which the Company carries on business;operating or technical difficulties in connection with mining or developmentactivities; the speculative nature of gold and base metals exploration anddevelopment, including the risks of diminishing quantities or grades ofreserves; and the risks involved in the exploration, development and miningbusiness. These factors are discussed in greater detail in the Company'sManagement's Discussion & Analysis for the year ended 31 December 2004 filed onSEDAR at www.sedar.com. The Company disclaims any intention or obligation toupdate or revise any forward-looking statements whether as a result of newinformation, future events or otherwise. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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