Q3 2009 Results - Part 1

 

TIDMEGU 
 
RNS Number : 2334C 
European Goldfields Ltd 
10 November 2009 
 

 
 
 
 
For Immediate Release 
                                      10 November 2009 
 
 
 
 
EUROPEAN GOLDFIELDS LIMITED 
 
 
RESULTS FOR Q3 2009 
 
 
MAJOR PERMITTING SUCCESS IN GREECE 
SKOURIES CONTRACT COMPLETED 
STRONG GOLD SALES 
 
 
10 November 2009 - European Goldfields Limited (AIM: EGU / TSX: EGU) ("European 
Goldfields" or the "Company") today reports its results for the quarter ended 
30 September 2009. 
 
 
Financial highlights: 
  *  Strong base metal concentrate sales, up by 21% against Q2 2009 
  *  Operating profits of $3.6 million for the period, up 12% on Q2 2009 
  *  Working capital of $146 million 
  *  US$ 23 million invested in projects during the quarter 
 
 
 
Operational highlights: 
  *  Greece: PEIS covering all projects and operations has been approved by the 
  Greek State 
  *  Martyn Konig appointed Executive Chairman. Bruce Burrows joins board of 
  Directors 
  *  Skouries: Equipment deliveries continue from Outotec 
  *  Olympias: Strong gold sales. Rehabilitation studies on the Mine and Process 
  Plant have commenced 
  *  Stratoni: Mine infrastructure essentially complete, Process Plant operating well 
  *  Certej: Basic Engineering for the Process Plant completed 
  *  Certej: Commencement of Technical Study for application for Construction Permit 
 
 
 
Commenting on the results, Martyn Konig Executive Chairman of European 
Goldfields, said: 
"We have entered an exciting period for this Company.  We aim to deliver the 
right valuation and performance for our Company through achieving the twin 
objectives of permitting and financing with a renewed and realistic approach in 
the coming months." 
 
 
European Goldfields will host a conference call at 10:00 a.m. ET / 3:00 pm 
(London, UK time) today 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: (toll free) 1888 935 4575 
From UK, Austria, Belgium, Denmark, France, Germany, Ireland, Italy, 
Netherlands, Norway, Sweden & Switzerland: [phone] (or toll free from 
the UK) 0800 028 1243 
Participant pass code: 5323840 
 
 
A live audio webcast of the call will be available on the following link, and a 
replay will be available on the same link from 12:00pm ET / 5:00pm (London, UK 
time): 
 
 
http://mediaserve.buchanan.uk.com/2009/eg101109/registration.asp 
 
 
For further information please contact: 
+------------------------------------------------+---------------------------------------------------+ 
| European Goldfields:                           | e-mail: [e-mail]                      | 
| Martyn Konig, Executive Chairman               | Tel: [phone]                          | 
+------------------------------------------------+---------------------------------------------------+ 
| Buchanan Communications:                       | e-mail: [e-mail]                    | 
| Bobby Morse / Katharine Sutton                 | Tel: [phone]                          | 
+------------------------------------------------+---------------------------------------------------+ 
| RBC Capital Markets:                           | e-mail: [e-mail]                    | 
| Sarah Wharry                                   | Tel: [phone]                          | 
+------------------------------------------------+---------------------------------------------------+ 
 
 
 
SELECTED FINANCIAL DATA 
 
 
 
 
+-----------------------------------+----------------------+------------------------+ 
|                                   | Quarter ended 30 September                    | 
|                                   |                                               | 
+-----------------------------------+-----------------------------------------------+ 
| (in thousands of US dollars,      |                 2009 |                   2008 | 
| except per share amounts)         |                    $ |                      $ | 
+-----------------------------------+----------------------+------------------------+ 
| Statement of profit and loss      |                      |                        | 
+-----------------------------------+----------------------+------------------------+ 
| Sales                             |               17,037 |                 18,461 | 
+-----------------------------------+----------------------+------------------------+ 
| Gross profit                      |                3,563 |                  3,470 | 
+-----------------------------------+----------------------+------------------------+ 
| (Loss)/Profit before income tax   |              (1,332) |                    242 | 
+-----------------------------------+----------------------+------------------------+ 
| Income taxes                      |              (1,847) |                    644 | 
+-----------------------------------+----------------------+------------------------+ 
| (Loss)/Profit after income tax    |              (3,179) |                    886 | 
+-----------------------------------+----------------------+------------------------+ 
| Non-controlling interest          |                   56 |                   (74) | 
+-----------------------------------+----------------------+------------------------+ 
| Profit for the period             |              (3,123) |                    812 | 
+-----------------------------------+----------------------+------------------------+ 
| Earnings per share                |               (0.02) |                   0.00 | 
+-----------------------------------+----------------------+------------------------+ 
 
+--------------------------+----------------+------------------+ 
| (in thousands of US      |   30 September | 31 December 2008 | 
| dollars)                 |           2009 |                $ | 
|                          |              $ |                  | 
+--------------------------+----------------+------------------+ 
| Balance sheet            |                |                  | 
+--------------------------+----------------+------------------+ 
| Working capital          |        146,158 |          192,675 | 
+--------------------------+----------------+------------------+ 
| Total assets             |        749,870 |          766,095 | 
+--------------------------+----------------+------------------+ 
 
 
 
 
 
European Goldfields' unaudited consolidated financial statements and 
management's discussion and analysis for the three month periods ended 30 
September 2009 and 2008 are filed on SEDAR at www.sedar.com. 
 
 
Q3 base metals showed a strong improvement over Q2 2009 as a result of continued 
improvements in base metal prices. Gold revenues fell as sales volumes declined, 
but the Company managed to increase gross profits compared to Q2 2009. Stratoni 
production remained behind budget but all significant capital expenditures have 
now been completed at the mine, securing its future operational capacity. The 
Company's lead hedging programme will remain in place until the end of 2009 and 
generated income of US$1.0 million for the quarter. Working capital declined as 
the Company continued its capital expenditure programmes at its operating mine 
and development projects, but the Company's balance sheet remains strong. 
 
 
 
CORPORATE ACTIVITY 
 
 
Board and Management Changes 
 
 
On October 9th 2009 the Company announced that, Mr. Martyn Konig has been 
appointed as Executive Chairman and President of the Company. 
 
 
At the same time Mr. Dimitrios Koutras stepped down as Chairman of the Company 
but remains both a Non-Executive Director and Executive Chairman of our 
95%-owned subsidiary Hellas Gold. The Company also announced the appointment of 
Mr. Bruce James Burrows as a Non-Executive Director of the Company. 
 
 
Following the watershed event of PEIS approval in Greece (see "Permitting 
Process - Greece" below) the Company is confident that it has the right set of 
skills and experience required to address the next phase of its development. Mr. 
Konig has initiated a review of its management, business and affairs that inter 
alia will set a revised set of targets for 2010 and the crucial forthcoming 
period of project development. 
 
 
Directors Dealings 
 
 
Effective upon his appointment as Executive Chairman and President of the 
Company, Martyn Konig was granted 600,000 Restricted Share Units ("RSUs"), and 
1,300,000 options, having a five year term and an exercise price of C$6.00 each. 
The 600,000 RSU's vest in three equal tranches if certain performance criteria 
are met and 1,000,000 of the options are also subject to various performance 
vesting criteria, with the balance being vested immediately. Mr. Konig has 
elected to receive up to half of his total annual remuneration of GBP342,000 in 
RSUs, issued on a quarterly basis, and to convert 145,907 deferred phantom 
units, which he was awarded in his previous capacity as an independent 
non-executive director, into a like number of RSU's which are currently vested. 
 
 
New appointments 
 
 
The Company is pleased to announce the appointment of three new Vice Presidents. 
 
 
Patrick Forward has been promoted to Vice President Projects and Exploration. 
Pat graduated in Mining Geology from the Royal School of Mines in 1989. Before 
joining European Goldfields as General Manager, Exploration in October 2004, he 
had worked for A.C.A. Howe International Limited. Between 1990 and 1995, he 
managed exploration projects in Europe, Ghana and Venezuela. For the following 
five years, he spent most of his time in Burkina Faso managing exploration 
programmes culminating in the discovery of the Nyafé deposit in Semafo Inc's 
Mana concession. On returning to the UK in 1999, Pat specialised in exploration 
management, geological due diligence, resource estimation, the application of 
GIS systems to exploration projects and deposit evaluation. As General Manager, 
Exploration he was responsible for European Goldfields exploration programmes 
and also involved with feasibility studies and development of European 
Goldfields major assets. 
 
 
Dimitris Dimitriadis has been promoted to Vice President Project Development. 
Dimitris graduated in Mining and Metallurgical Engineering from the National 
Technical University of Athens and has more than 30 years experience in mining 
and metallurgy, as well as exposure to both the construction and financial 
sectors. Before joining European Goldfields as Business Development Manager in 
July 2006 he had worked for Hellas Gold S.A. as Business Development Manager 
principally in the restructuring of the Kassandra Mines and the introduction of 
new technology to the process plants, definition of new projects and the 
successful opening of new markets for its concentrate production. Before joining 
Hellas Gold S.A. he was General Manager and Member of the Board of ELMIN S.A. a 
bauxite producing company. His career first started at METBA S.A initially as a 
Process Engineer and then as a Project Engineer. Among other highlights during 
1995 to 2002 Dimitris worked with TVX Hellas initially as Senior Metallurgist 
and then as Business Development Manager. 
 
 
Sally Schofield has been hired as Vice President Investor Relations. Sally's 
career has seen her work in commercial, technical and operational capacities in 
geographically and politically diverse regions including Kazakhstan, Albania, 
Central America, Brazil and Chile. She gained early exposure to the technical, 
corporate and investor relations functions of the mining business before 
crossing sectors to work with RMC, now part of CEMEX, the global building 
materials giant.   Sally returned to mining in 2003 and became a Director of 
AIM-listed Latitude Resources plc, a company with copper/gold assets in Chile. 
As Chief Operating Officer of the company she relocated to Santiago, Chile in 
2006, with direct responsibility for an exploration program that developed a 
portfolio of exploration projects into a saleable asset. She then worked for a 
natural resource focused fund identifying potential assets. Sally graduated from 
the Camborne School of Mines with a First Class B. Eng (hons) Industrial Geology 
in 1995, is a Fellow of the Geological Society (FGS) and a professional member 
of IOM3 (MIMMM). In connection with Sally's appointment the Company intends to 
grant her 50,000 share options and 50,000 RSUs in the near future. 
 
 
 
 
 
 PERMITTING PROCESS - GREECE 
 
 
In late September the then Ministry of Environment, Physical Planning and Public 
Works, completed the Preliminary Environmental Assessment and Evaluation based 
on the Preliminary Environmental Impact Study ("PEIS") submitted by the 
Company's 95%-owned subsidiary Hellas Gold SA, and issued a pre-approval of the 
construction and operation of the Project ("the Pre-Approval") in the province 
of Halkidiki, in North-Eastern Greece. 
 
 
The "Project", consists of: 
  *  The development of mining and processing at the Skouries project. 
  *  The next stages of the Olympias project, namely the mining and processing of ore 
  and metallurgical treatment of the concentrate, in accordance with the business 
  plan as originally submitted. 
  *  Continuation of operations at the Mavres Petres deposit of the Stratoni Mine. 
  *  The port facilities at Stratoni in service of the above projects' operations. 
 
 
 
This Pre-Approval of the Project, successfully concludes the major stage of 
assessment by the authorities and will lead to the preparation and submission of 
the Environmental Impact Study ("EIS") and supporting studies required by Greek 
and European Legislation. The EIS will be based on terms of reference as now 
defined by the Pre-Approval. The EIS will be submitted to the relevant 
authorities for review and the normal European Union public consultation 
requirements in the near future. The Company is confident that the extensive 
detail of the successful Pre-Approval process will in turn now optimise approval 
of the EIS. 
 
 
 
 
SKOURIES PROJECT (GREECE) 
 
 
Highlights 
  *  Outotec equipment contract complete 
  *  Basic Engineering package delivered to schedule 
  *  Outotec continues to advance their Detailed Engineering package 
 
 
 
Outotec equipment contract complete 
During the quarter, the final payments were made to Outotec in respect of the 
technology package for the Skouries project, which consists of the SAG and ball 
mills, motors and thickeners. All fabrication of this equipment is therefore 
complete, which represents the bulk of the process plant for the project. 
Process equipment deliveries to Greece continue and equipment is held at a 
storage facility in Thessaloniki which has been approved by Outotec. 
 
 
Basic Engineering package delivered to schedule 
The Greek engineering group ENOIA has issued the Basic Engineering package 
including an initial draft of an updated budget cost estimate for the process 
plant and associated infrastructure to Hellas Gold. The Basic Engineering 
package comprises plant design by ENOIA and Outotec; the mine and roads design 
by Geotechnical Consultants Omicron Kappa; architectural design by KION and the 
civil structures and works by MHXME. Basic and Detailed level Engineering 
studies are currently underway for the tailings facility, infrastructure and 
dump design and once completed then revised project capital and operating costs 
will be published. 
 
 
A hydrogeological study by IGME, the Greek geological survey, has been also been 
completed and detailed design of the tailings management facility ("TMF") is 
currently being undertaken by Omikron Kappa. 
 
 
Outotec continues to advance their Detailed Engineering package 
Outotec continues to advance their Detailed Engineering of instrumentation and 
control systems for the Concentrator plant. ENOIA are coordinating the overall 
control package including equipment outside of Outotec's supply to provide a 
fully integrated system. 
 
 
Equipment orders which fall outside the scope of Outotec's supply contract such 
as the open pit cone crusher, pebble crushers, pumps and flotation cells are 
also well advanced. 
  OLYMPIAS PROJECT (GREECE) 
 
 
Highlights 
  *  Sale of gold concentrates up by 71% over Q3 2008 
  *  Approval of EIS for re-treatment of tailings anticipated 
  *  The audit for the plant rehabilitation has commenced 
  *  A study for refurbishment of underground workings is in progress 
 
 
 
Sale of gold concentrates up by 71% over Q3 2008 
The Olympias project benefits from an existing stockpile of gold-bearing pyrite 
concentrates which represented, at 1 January 2009, a reserve of approximately 
101,000 tonnes grading 23.5 g/t gold (containing approximately 75,000 oz of 
gold). Excavation of the concentrate for shipment has indicated that the depth 
of stockpile base was underestimated in several areas by historical surveys and 
therefore additional concentrate tonnage exists compared to the declared 
reserve. In addition there are 2.4Mt of tailings containing 238,000 oz of gold 
and substantial underground reserves of gold, lead, zinc and silver. 
 
 
Hellas Gold completed 16 shipments of Olympias concentrates in Q3 2009 (Q3 2008 
- 8). This translates into 21,734 tonnes of pyrite concentrates sold. 
Sales of pyrite concentrates were as follows: 
+-------------+--------+--------+--------+--------+ 
|             |     Q3 |     Q3 |    YTD |    YTD | 
|             |   2009 |   2008 | end Q3 | end Q3 | 
|             |        |        |   2009 |   2008 | 
+-------------+--------+--------+--------+--------+ 
| Sales       |        |        |        |        | 
+-------------+--------+--------+--------+--------+ 
| Gold        | 21,734 | 12,710 | 80,700 | 44,967 | 
| concentrate |        |        |        |        | 
| (dry        |        |        |        |        | 
| tonnes)     |        |        |        |        | 
+-------------+--------+--------+--------+--------+ 
 
 
Re-processing of the existing tailings will yield further high-grade gold 
concentrates of approximately 350,000 tonnes. 
 
 
 
 
Plant and Underground Rehabilitation at Olympias 
The engineering study for the Olympias Mill rehabilitation has been awarded to 
the Greek engineering company "Renewables". 
 
 
A study to outline the rehabilitation works and associated costs for the 
underground infrastructure is being completed by Scott Wilson Mining. 
Refurbishing of the mine offices and the construction of a shotcrete plant on 
site are already underway. 
 
 
  STRATONI OPERATIONS (GREECE) 
 
 
 
 
Highlights 
  *  All major mine infrastructure in place with the completion of the upper adit 
  *  Improvement in geotechnical conditions 
 
 
 
Production 
The Stratoni mine consists of a lead-zinc-silver deposit and lies approximately 
four kilometres from the coastal town of Stratoni in northern Greece. The 
Company's 95% owned subsidiary Hellas Gold mined a total of 57,235 wet tonnes in 
Q3 2009 (Q3 2008 - 69,847). 
Hellas Gold has completed 19 shipments for the year to end Q3 2009 (to end Q3 
2008 - 20), twelve shipments of zinc and seven of lead/silver. 
 
 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
|                                                                                                                     |      Q3 |      Q3 |     YTD |     YTD | 
|                                                                                                                     |    2009 |    2008 |  end Q3 |  end Q3 | 
|                                                                                                                     |         |         |    2009 |    2008 | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Production                                                                                                          |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Ore                                                                                                                 |  57,235 |  69,847 | 174,150 | 201,191 | 
| mined                                                                                                               |         |         |         |         | 
| (wet                                                                                                                |         |         |         |         | 
| tonnes)                                                                                                             |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Sales                                                                                                               |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Zinc                                                                                                                |   7,937 |  14,033 |  28,889 |  34,017 | 
| concentrate                                                                                                         |         |         |         |         | 
| (tonnes)                                                                                                            |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| -                                                                                                                   |   3,325 |   5,818 |  11,904 |  16,780 | 
| Containing                                                                                                          |         |         |         |         | 
| payable:                                                                                                            |         |         |         |         | 
| Zinc                                                                                                                |         |         |         |         | 
| (tonnes)*                                                                                                           |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Lead                                                                                                                |   4,736 |   5,475 |  12,269 |  16,009 | 
| concentrate                                                                                                         |         |         |         |         | 
| (tonnes)                                                                                                            |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| -                                                                                                                   |   3,042 |   3,495 |   7,837 |  10,580 | 
| Containing                                                                                                          |         |         |         |         | 
| payable:                                                                                                            |         |         |         |         | 
| Lead                                                                                                                |         |         |         |         | 
| (tonnes)*                                                                                                           |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
|                                                                                                              Silver | 228,574 | 263,464 | 595,530 | 803,875 | 
|                                                                                                              (oz)*  |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Inventory                                                                                                           |         |         |         |         | 
| (end of                                                                                                             |         |         |         |         | 
| period)                                                                                                             |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Ore                                                                                                                 |   8,097 |   6,489 |   8,097 |   6,489 | 
| mined                                                                                                               |         |         |         |         | 
| (wet                                                                                                                |         |         |         |         | 
| tonnes)                                                                                                             |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Zinc                                                                                                                |     607 |   2,078 |     631 |   2,078 | 
| concentrate                                                                                                         |         |         |         |         | 
| (tonnes)                                                                                                            |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
| Lead/silver                                                                                                         |     901 |   1,294 |     886 |   1,294 | 
| concentrate                                                                                                         |         |         |         |         | 
| (tonnes)                                                                                                            |         |         |         |         | 
+---------------------------------------------------------------------------------------------------------------------+---------+---------+---------+---------+ 
*    Net of smelter payable deductions 
 
 
The completion of a new upper adit marks the finalisation of major mine 
infrastructure which has been ongoing over the last four years and includes a 
new lower decline, new surface workshops, new backfill plants, two filter 
presses and a new water treatment plant. Internal development, including ramp 
extensions and access drives, is essentially complete for the year. 
 
 
Production was under budget for the quarter due to the continuation of the poor 
geotechnical conditions which compounded mining cycle conflicts. The mine has 
experienced an improvement in the geotechnical conditions as mining has moved 
away from the Stratoni Fault and the mining cycle issues have eased as new 
levels entered into production late in the quarter. 
 
 
Process plant performance 
Zinc and lead metal recoveries are being maintained on budget at a consistent 
92% and silver at 87%.  A circuit to improve the quality of the lead concentrate 
is in the final design stage and installation is planned for early 2010. Working 
conditions in the plant were improved by capturing gases from reagent tanks and 
filtering impurities. 
 
 
Fatality in the mine 
 
 
On the 14th of October 2009 the death of a miner occurred due to an underground 
accident at Stratoni's Mavres Petres mine. The Company reported on 15th October 
that a rockfall occurred during roof maintenance 162 metres underground, killing 
one worker and injuring a second. The rockfall actually occurred at mine level 
162 which is in fact more than 300 metres below surface.  The Company reiterates 
its condolences to the family, friends, and colleagues of the deceased. 
Production at the mine resumed after a short closure period of two working days, 
in line with the Company's previous announcement. The Health Safety and 
Environment Committee of the Board immediately requested a review of procedure 
and practices and is considering the resultant recommendations made by Hellas 
Gold management. 
 
 
  EXPLORATION IN GREECE 
 
 
An airborne electromagnetic (EM) survey has proved highly effective in 
confirming an anomaly extending eight km of strike at the Piavitsa massive 
sulphide target. Two km of this strike length have historic massive sulphide 
drill intercepts which correspond exactly with the EM anomaly. The footprint of 
the target is larger than that of the Company's Olympias project. 
 
 
In addition, the magnetic component of the airborne survey has already 
identified a 17 km by six km belt of porphyry intrusives over which a 
three-dimensional inversion model has been completed defining two other major 
targets. Follow-up reconnaissance mapping has confirmed the presence of porphyry 
style mineralisation on all targets outlined by the magnetic survey. 
 
 
An EIS is now being considered by the local authorities to allow access to drill 
sites on both the massive sulphides and porphyry targets in the near future. 
 
 
 
 
  CERTEJ PROJECT (ROMANIA) 
 
 
 
 
Highlights 
  *  Basic engineering of the Process Plant completed 
  *  Commencement of Technical Study for application for Construction Permit 
  *  Permitting process continues to advance, public consultation completed 
 
The Certej project in Romania is situated near the town of Deva and has 
excellent infrastructure with mining activity in the very recent past. The 
project is currently at the development stage with reserves of 2.41 million 
ounces gold and 17.3 million ounces silver. The project will involve mining and 
processing 3.0 million tonnes of ore per annum over an open pit life of 11.5 
years. The mine is expected to produce approximately 160,000 oz of gold and 
820,000 oz of silver per year, reflecting an average total process recovery of 
81% for gold and approximately 75% for silver. Thereafter, the plant will be fed 
for a further five years at the same throughput rate by lower-grade material 
stockpiled from the open pit and historic dumps. 
 
 
Ore processing will comprise the production of a flotation concentrate, followed 
by the extraction of gold and silver into doré on site, incorporating an 
oxidation stage using 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 process. 
 
Basic engineering completed 
The Basic Engineering ("BE") contract for the Certej project process plant and 
associated infrastructure awarded to Aker Solutions Engineering & Construction 
was completed in September 2009. The BE covers the entire process plant 
engineering and Xstrata Technology, who are owners of the Albion Process were 
part of the engineering team. Basic and Detailed level Engineering studies are 
currently underway for the tailings facilities, infrastructure and mine and dump 
design and once completed then revised project capital and operating costs will 
be published. 
 
 
The Romanian contractor Cepromin has been appointed to prepare the Technical 
Project Report which involves advancing the BE level studies. They have started 
the work to generate the Technical Project Report, which together with the 
environmental permits will be required for issuing the Construction Permit. The 
Technical Project Report is due for completion in H1 2010. 
 
 
Golder Associates UK completed the DFS of the TMF designs in Q1 2009 and has now 
commenced to assist Cepromin with the Technical Project Report. 
 
Permitting process continues to advance 
The Certej project had already received all the technical mining approvals by 
September 2008, when the Romanian National Agency for Mineral Resources ("NAMR") 
approved the Technical Feasibility Study ("TFS") for the project, as required 
under Romanian legislation, including the approval and state registration of the 
project's resources and reserves. This completed all the mining approvals 
required for the project from NAMR and was a very significant step forward in 
the development of the project. 
 
 
A public consultation process in respect of the environmental permit for the 
Zonal Urbanisation Plan ("PUZ") has also been successfully concluded: the public 
consultation involved four public hearings in the communities most directly 
affected by the Certej project. No adverse comments were raised during the 
public notice period, during the meetings themselves or subsequently to the 
authorities. The PUZ process is almost complete with 16 of the 17 constituent 
permits required being obtained, including that relating to water. A positive 
final-outcome of the process is expected in the near future. 
 
 
In anticipation of the approval of the PUZ, the Ministry of the Environment has 
invited the Company to file its EIS application, which will also then be subject 
to the last requirement for public consultation prior to the issuance of the 
environmental permit. These, together with the construction permit, are the 
final approvals required for the construction and operation of the plant, the 
tailings design and other related infrastructure. 
 
 
Certej financing progresses 
As part of the project financing process, an internationally recognised 
engineering group has been appointed as Independent Technical Consultant for the 
Certej Project. A site visit has already been conducted and a review of the 
Certej Definitive Feasibility study and all its supporting documents is nearing 
completion.  The shortlisted group of financing institutions have been sent a 
draft term sheet and detailed banking model with a target of agreeing commercial 
terms and securing lending commitments over the coming months, subject to final 
documentation. The Company aims to have completed the project finance process in 
the first part of 2010. As part of the proposed structure, the Company has 
stated its intention not to hedge any upside participation in the gold price. 
 
 
 
 
EXPLORATION IN ROMANIA 
 
 
In early 2009 the Company acquired two new prospecting licences for 454 square 
kilometres of prospective terrain, covering the westward extension to the area 
hosting the Company's Certej deposit and the area containing the Deva Porphyry 
deposit. These areas are prospective for disseminated gold, porphyry 
mineralisation as well as the more prolific and higher-grade epithermal 
deposits. 
 
 
Work in the quarter has been focused on the Deva Porphyry area, which hosts a 
volcanic complex, including the historically mined Deva Porphyry pipe, which 
produced some 20Mt at 0.8% Cu with the gold grade unrecorded. The Company has 
completed a ground magnetic survey and soil surveys both of which have 
highlighted a series of porphyry targets which were not previously recognised. 
 
 
In addition soil grids, mapping and re-interpretation of existing data have 
outlined several epithermal gold targets proximal to the historic Brad mines and 
within the same volcanic belt as the Certej deposit. 
 
 
These targets will be tested with more detailed exploration work and drilling in 
2010. 
 
 
  EXPLORATION IN TURKEY 
 
 
In April 2008 the Company entered into a joint venture with Ariana Resources plc 
("Ariana") with respect to mineral properties in the Eastern Pontide area of 
northeast Turkey. 
 
 
Mapping and sampling has confirmed that porphyry mineralisation continues to the 
south of the previously recognised outcrops, and this additional extension 
increases the size potential of the porphyry system. A high-grade gold zone has 
also been identified at Salinbas, some three km to the southwest of the Ardala 
porphyry.  Trenching at Salinbas has returned the following bedrock intercepts 
over a 360m strike length with mineralisation open to the south and at depth: 
 
 
  *  Trench 1, 26 m @ 5.4 g/t Au, 
  *  Trench 2, 6 m @ 2.8 g/t Au 
  *  Trench 3, 46 m @ 8.3 g/t Au 
  *  Trench 4, 6 m @ 2.8 g/t Au 
  *  Trench 5, 14 m @ 7.3 g/t Au and 33 m 9.62 g/t Au 
  *  Trench 6, 9 m @ 4.3 g/t Au 
 
Note: These intercepts are calculated at a 0.5g/t Au cut-off, no upper-cut. 
 
 
Drilling and further trenching are planned at both Ardala and Salinbas for the 
near future. 
 
 
The Company continues to consolidate ground to the south of the Ardala licence 
and finalise paperwork in the next few days with Aldridge Minerals Inc 
("Aldridge") for the joint development of Aldridge's Derinkoy properties, which 
covers an area of 40 square km adjacent to the Company's Ardala Licences. The 
properties lie within the area of interest of the Company's joint venture with 
Ariana (the "Pontid JV") and as such will be developed within the Pontid JV 
vehicle.  Mapping and soil sampling over the property will be completed by the 
end of the year. 
 
 
About European Goldfields 
European Goldfields Limited is a resource company involved in the exploration, 
acquisition, mining and development of mineral properties in Greece, Romania and 
South-East Europe. 
Greece - European Goldfields holds a 95% interest in Hellas Gold S.A. Hellas 
Gold owns three major gold and base metal deposits in Northern Greece. The 
deposits are the polymetallic operation at Stratoni, the Olympias project which 
contains gold, zinc, lead and silver, and the Skouries copper/gold porphyry 
project. Hellas Gold commenced production at Stratoni in September 2005 and 
started selling an existing stockpile of gold concentrates from Olympias in July 
2006. Hellas Gold is applying for permits to develop and build the Skouries and 
Olympias projects. 
Romania - European Goldfields owns 80% of the Certej gold/silver project in 
Romania. In July 2008, the National Agency of Mineral Resources approved the 
technical feasibility study in support of its permit application and issued a 
new mining permit for the Certej project. 
 
 
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 2008, filed on SEDAR at 
www.sedar.com. 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 law. 
 
 
 
 
 
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            The company news service from the London Stock Exchange 
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