EGU European Gold

RNS Number:5945G
European Goldfields Ltd
24 July 2006


For Immediate Release                                              24 July 2006





                          European Goldfields Limited



                Final Feasibility Studies on Track for Skouries



European Goldfields Limited (AIM: EGU / TSX: EGU) is pleased to announce that
its 65%-owned subsidiary Hellas Gold S.A. has retained the services of Aker
Kvaerner Engineering Services, Golder Associates and a number of Greek
consultants to assist in the development of the Skouries project.



Hellas Gold is actively pursuing various studies for input in a final bankable
feasibility study for Skouries.  These studies, which are expected to be
completed by year-end, include:

*                A cost and definition study for the Skouries process plant and
associated infrastructure, undertaken by Aker Kvaerner Engineering Services

*                The design of the Skouries tailings disposal system and
tailings management facility, undertaken by Golder Associates

*                An Environmental Impact Study, carried out by the Greek
consulting group Enveco

*                A study of hydrogeology and creek boundaries by IGME, the Greek
Institute of Geology & Mineral Exploration, to be used in the development of a
new hydrogeological model.



European Goldfields also recently published upgraded Canadian NI 43-101 reserves
for Skouries, with sign-off from independent consultants SRK Consulting (UK)
Limited. This increase in reserves resulted from a new mine plan and schedule
which includes the adoption of a deeper open pit, an optimised sub-level cave
underground mine design and improved long-term metal price forecasts.



Commenting on the announcement, David Reading, Chief Executive Officer of
European Goldfields, said: "We welcome Aker Kvaerner, Golders, Enveco and IGME
as part of our integrated team of Greek and international professionals.  The
bankable feasibility study is an important milestone for the successful
advancement of our Skouries project, and we are pleased to benefit from their
international and local experience and reputation in building similar projects."



Background Information on Skouries



The total proven and probable reserve at Skouries is 146.2 Mt grading 0.83 g/t
gold and 0.54% copper, from a total measured and indicated resource of 191.2 Mt
grading 0.82 g/t gold and 0.55% copper.



Skouries has been optimised as a 7M tonnes per annum operation with a low strip
open pit of at least six years, followed by underground mining which will
produce some 790,000t of copper and 3.9M oz of gold over a 21-year mine life.
The start of full production is planned for 2009. This production rate is shown
to be sustainable based on the detailed mine design carried out by SRK and
benchmarking with other comparable mines.



The Skouries deposit is a typical gold-copper porphyry deposit that forms a near
vertical pipe and is located 35 km by road from the Stratoni port in northern
Greece.  Skouries is located on a high plateau with no habitation in the
immediate vicinity.



The mining at Skouries will be phased with the open pit mined at the target rate
for the first six years and the underground mining development starting in the
fourth year of operation. A continuous feed of 7M tonnes per annum to the plant
is ensured by the use of stockpiled open pit low-grade material.  The current
model uses a 240m deep pit followed by an underground sub-level cave (SLC)
operation, which gives the best economic return according to a study by SRK.



The metallurgy at Skouries is straight-forward. The mine will feed a process
plant designed for a nominal throughput of 21,000 tonnes per day.  The
processing will comprise gyratory crushing for open pit and underground ore,
single-stream SAG and ball-mill grinding.  Approximately 30% of gold will be
recovered by a gravity circuit to produce dore on site. A high-quality saleable
copper/gold concentrate will also be produced by conventional froth flotation,
thickening and filtration.



Extensive test-work carried out by Lakefield Research and other consultants has
shown average recoveries of 83.9% gold and 90.8% copper can be achieved.
Concentrate grades of at least 26% copper and averaging 27 g/t gold are
expected.



The concentrates will be trucked to Hellas Gold's port storage facility at
Stratoni, which is some 35 km away by road from the Skouries plant site.



Golder Associates have carried out a pre-feasibility level study which
incorporates the latest paste production technology in a phased tailings
management facility (TMF) that will minimise land take and embankment height and
provides increased stability. Paste tailings also allows a greater proportion of
the process water to be collected and recycled at the process plant, reducing
pumping costs and the quantity of make-up water needed.  Studies have shown that
the paste tailings are inert with low permeability. The use of paste tailings
and a phased TMF also allows sequential rehabilitation of the tailings
management facility to minimise active tailings areas.



About European Goldfields



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



Greece - The Company holds a 65% interest in Hellas Gold S.A. ("Hellas Gold").
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 7.8 Moz gold, 65.8
Moz silver, 0.8 Mt copper, 0.7 Mt lead and 0.9 Mt zinc, from a measured and
indicated resource base of 9.4 Moz gold, 74.5 Moz silver, 1.0 Mt copper, 0.8 Mt
lead and 1.1 Mt zinc (65% attributable).



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 revenue-generating stockpiles of gold
concentrates.



In September 2005, Hellas Gold resumed production at Stratoni following the
award by the Greek State of all necessary environmental and mining permits.
Hellas Gold is in the process of applying for similar permits for Olympias and
Skouries, having met its first milestone by submitting business plans to the
Greek government in January 2006.



Romania - The Company holds four mineral properties located within the "Golden
Quadrilateral" area of Romania. The Company recently announced the conversion of
resources into Canadian NI 43-101 compliant reserves for its 80%-owned Certej
project, underpinning the value of the project. The Certej deposit hosts
probable reserves of 27.7 Mt grading 2.0 g/t gold and 11.6 g/t silver for 1.76
Moz gold and 10.35 Moz silver (80% attributable). The Company is now completing
a final feasibility study for submission to the Romanian government by the end
of 2006, in support of an application for environmental and mining permits to
develop the Certej project.



Resources & reserves parameters



For additional information on the resource and reserve estimates quoted in this
news release, please refer to the Company's Resources & Reserves Declaration at
www.egoldfields.com/goldfields/resources.jsp. Patrick Forward, General Manager,
Exploration of the Company, was the Qualified Person under Canadian National
Instrument 43-101 responsible for reviewing the disclosure of resource and
reserve estimates quoted in this news release.



For further information please contact:

European Goldfields:                                    website: www.egoldfields.com
David Reading, Chief Executive Officer                  e-mail: info@egoldfields.com
Office: +44 (0)20 7408 9534

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

Renmark Financial Communication:                        website: www.renmarkfinancial.com
Neil Murray-Lyon                                        e-mail: nmurraylyon@renmarkfinancial.com
Henri Perron                                            e-mail: hperron@renmarkfinancial.com
Office: +1 514 939 3989



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.




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