Albion Licence for Certej

RNS Number:9942J
European Goldfields Ltd
05 October 2006



For Immediate Release                                            5 October 2006


             LICENCE AGREEMENTS SIGNED FOR ALBION PROCESS AT CERTEJ


European Goldfields Limited (AIM: EGU / TSX: EGU) is pleased to announce that it
has entered into Licence Agreements securing the Albion Process Technology for
its 80%-owned Certej project in Romania.


The Licence Agreements were entered into with Xstrata Queensland Limited and
Highlands Frieda Limited, the co-owners of the technology.


Commenting on the agreements, David Reading, Chief Executive Officer of European
Goldfields, said: "We are delighted to be involved with companies such as
Xstrata, Highlands and their agent Core Resources in the development of the
Certej project. The Albion Process is an exciting technology which is well
suited to Certej and which should significantly increase the profitability of
the project."


Flexibility of two viable development options - European Goldfields is actively
pursuing two viable development options for the Certej project:

   * the production and sale of high-grade gold/silver flotation concentrates
   * the production of gold dore on site using the Albion Process.


Using the Albion Process to produce gold dore on site is expected to
significantly increase project profitability and returns.


The project can also be developed in phases, starting with the sale of
concentrates in the early years followed by the production of gold dore on site.


Sale of high-grade concentrates - In April 2006, European Goldfields announced
the conversion of resources into Canadian NI 43-101 compliant reserves for the
Certej deposit, based on the sale of concentrates option. This confirmed that
the project can support the necessary capital investment and produce a robust
return at a gold price of $425/oz and above.


This estimation followed the completion of extensive metallurgical testwork, an
in-house pre-feasibility study and subsequent pit optimisation and pit design
work by RSG Global, which included a geotechnical drilling programme and
geotechnical pit design parameters completed by Golder Associates of the UK.


The project is expected to involve the mining and processing of 3.0 Mt per annum
over at least nine years. This would yield approximately 275,000 tonnes of
concentrate per annum with high grades ranging realistically between 17 - 22 g/t
gold and 85 - 165 g/t silver (depending on the source of the ore in the
deposit), with a flotation gold recovery of approximately 88%. This translates
into an annual production of approximately 170,000 oz of contained gold in the
concentrate.


Production of gold dore on site - The Albion Process is an alternative
development route to the sale of concentrates at Certej. The Albion Process is a
combination of ultra-fine grinding and hot oxidative leaching at atmospheric
pressure.


European Goldfields announced in July 2006 that it had received additional
results of batch metallurgical testwork indicating a substantial increase in
gold recoveries from samples of flotation concentrates produced from Certej ore.
The new results using the Albion Process at optimised oxidation conditions
suggest recoveries from concentrates of approximately 96% for gold, compared to
previously reported recoveries of 84%. Silver recoveries remain stable,
averaging 92%.


Hydrometallurgy Research Laboratories (HRL, a subsidiary of Xstrata PLC) is
conducting the Stage III pilot plant scale continuous testwork programme using
the Albion Process, after which European Goldfields expects to publish Canadian
NI 43-101 compliant reserves based on this process in Q1 2007. HRL has already
successfully completed Stages I and II of the metallurgical testwork programme.


About European Goldfields


European Goldfields is a resource company involved in the acquisition,
exploration and development of mineral properties in Greece, Romania and the
Balkans.


Greece - European Goldfields holds a 65% interest in Hellas Gold S.A. Hellas
Gold owns the three major gold and polymetallic deposits of Stratoni, Skouries
and Olympias in Northern Greece. Hellas Gold commenced production at Stratoni in
September 2005 and selling an existing stockpile of Olympias gold concentrates
in July 2006. Hellas Gold is applying for permits to develop the Skouries and
Olympias projects.


Romania - European Goldfields owns 80% of the Certej project in Romania.
Resources were recently converted into Canadian NI 43-101 compliant reserves,
underpinning the value of the project. European Goldfields is now completing a
feasibility study for submission to the Romanian government in Q1 2007, in
support of a permit application to develop the project.


For further information please contact:

European Goldfields:                    website: www.egoldfields.com
David Reading, Chief Executive Officer  e-mail: [e-mail]
Office: [phone]

Buchanan Communications:                e-mail: [e-mail]
Bobby Morse / Ben Willey
Office: [phone]
Mobile: [phone]

Renmark Financial Communication:        website: www.renmarkfinancial.com
Tina Cameron                            e-mail: [e-mail]
Neil Murray-Lyon                        e-mail: [e-mail]
Office: [phone]



Forward-looking statements


Certain information included in this news release, 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 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 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 worldwide price of gold, base metals or certain other
commodities (such as fuel and electricity) and currencies; 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; and the risks normally involved in the
exploration, development and mining business. These factors are discussed in
greater detail in the Company's Annual Information Form for the year ended 31
December 2005, filed on SEDAR at www.sedar.com. The Company disclaims any
intention or obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise.




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