EGU European Gold

RNS Number:4428X
European Goldfields Ltd
25 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 the
following update on its 80%-owned Certej project in the Southern Apuseni
Mountains 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 of
European Goldfields, said:

"Following commencement of production at our Stratoni mine in Greece, European
Goldfields continues to develop its portfolio of assets. We are making steady
and significant progress on our Certej project. We look forward to converting
resources to reserves in March and thereafter setting out a clear roadmap to
permitting and project development".

In-house pre-feasibility study completed - In July 2005, European Goldfields
completed an in-house pre-feasibility study on the Certej project. The study has
resulted 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 impact
assessment and achieve all necessary permitting.

It is envisaged that the project could mine and process 3.0 Mt per year over at
least eight years, following the pit optimisation work currently in progress. At
the proposed production rates, this would yield approximately 252,000 tonnes of
concentrate per year with grades averaging 20 g/t gold and +130 g/t silver, with
a flotation gold recovery of about 87.2%.

Environmental studies under way - European Goldfields plans to complete the
necessary Environmental Impact Assessments (EIA Levels I and II) and an
Environmental Impact Study (EIS) and to apply for the necessary planning permits
later in 2006. ECOIND, a Romanian company who have a well-proven track record in
environmental research and permitting procedures, have been employed to carry
out this work. The EIA Level I was completed in December 2005 and work has
commenced on the EIA Level II. This will be followed by the EIS in order to
progress to full feasibility study, permit application and project development.

Letters of interest received from traders - European Goldfields received letters
of interest from two East European metal traders indicating their willingness to
negotiate the purchase of all the high grade gold/silver flotation concentrates
to be produced at Certej. The terms received confirm that the sale of
concentrates would support the necessary capital investment and produce a viable
return for the Certej project at a gold price above $425/oz.

On-site production of gold dore being investigated - European Goldfields is also
actively 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 is
considered the most promising. The Albion process is a combination of ultra-fine
grinding and oxidatative leaching at atmospheric pressure. Samples of flotation
concentrates produced from the locked-cycle test work at SGS-Lakefield were
recently tested at Hydrometallurgical Research of Australia. Initial results
indicate that a flotation concentrate produced from Certej ore can be processed
by the Albion Process to produce gold dore on site. Additional test work and a
cost analysis are underway.

Final pit optimisation in progress - The in-house pre-feasibility study
indicated that 22.5 Mt could be economically mined by open pit methods at a
grade of 2 g/t gold and 10 g/t silver. Golder Associates (Golders) of the UK
have been engaged to complete a geotechnical study for slope angles for the
future Certej open pit. An eight hole geotechnical drilling program designed by
Golders was completed in January 2006. A slight increase in overall wall angle
would improve the strip ratio and allow additional +2g/t gold material to be
mined at the base of the current pit design. RSG Global of Australia are then
expected to complete a final pit optimisation based on Golders' work, European
Goldfields' resource estimates and the recent "mapping" of the various recovery
zones.

Ongoing exploration - The Certej deposit hosts measured and indicated resources
of 31.4 Mt grading 2.1 g/t gold and 11 g/t silver. Further exploration work in
Romania is now focused on defining additional resources to add to the open
pitable resources at Certej (approximately 22 Mt) and extend the life of mine of
the project. European Goldfields has identified a number of satellite targets
which comprise open pitable mineralisation within the Certej licence area and
the adjacent Baita-Craciunesti licence area. In addition, surface dumps are
being evaluated for their tonnage grade and metallurgical characteristics. As
announced on 5 December 205, preliminary drilling results are encouraging.

Resources & Reserves Parameters

For additional information on the resource and reserve estimates for the
Company's projects, please refer to the Company's Resources & Reserves
Declaration 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 the
Balkans.

Greece - European Goldfields holds a 65% interest in Hellas Gold S.A. Hellas
Gold owns assets in Northern Greece which consist of three deposits within
70-year mining concessions covering a total area of 317 km(2). The deposits
include the polymetallic projects of Stratoni and Olympias which contain gold,
lead, zinc and silver, and the copper-gold porphyry body referred to as
Skouries. All three deposits have been well defined with over 200,000 metres of
drilling and the completion of feasibility studies and later engineering
studies.

The total proven and probable reserves of these assets are 17.2 Moz on a gold
equivalent basis (65% attributable = 11.2 Moz) from a measured and indicated
resource base of 21.8 Moz gold equivalent (65% attributable = 14.2 Moz).

These assets represent some of the largest defined deposits in Europe. The three
deposits are located within a 10 km radius of each other, making this
effectively a gold and base metals centre. Furthermore, both Stratoni and
Olympias were previously in production and have extensive existing mining and
plant infrastructure and a ship loading facility on the Aegean Sea. Hellas
Gold's assets also include potential revenue generating stockpiles and tailings
located on the surface.

In September 2005, Hellas Gold resumed production at Stratoni following the
award 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 first
year of production, steadily increasing to 400,000 tonnes per annum by year
five. Hellas Gold is in the process of applying for similar permits for Olympias
and Skouries.

Romania - European Goldfields holds five mineral properties located within the
"Golden Quadrilateral" area of Romania, where it has recently completed an
in-house pre-feasibility study underpinning the value of its 80%-owned Certej
deposit. The Certej deposit hosts measured and indicated resources of 31.4 Mt
grading 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 Officer
David Grannell, Chief Financial Officer
Office: +44 (0)20 7408 9534                 e-mail: info@egoldfields.com
Mobile: +44 (0)7703 190 652                 website: www.egoldfields.com

Buchanan Communications:
Bobby Morse / Ben Willey                    e-mail: bobbym@buchanan.uk.com
Office: +44 (0)20 7466 5000
Mobile: +44 (0)7802 875 227

The Sherbourne Group
Forbes West                                 e-mail: forbes@sherbournegroup.ca
Office: +1 416 203 2200

Forward-looking Statements

Certain information included 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 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; ability to
successfully integrate acquired assets; legislative, political 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 involved in the exploration, development and mining
business. These factors are discussed in greater detail in the Company's
Management's Discussion & Analysis for the year ended 31 December 2004 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.




                      This information is provided by RNS
            The company news service from the London Stock Exchange

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