European Goldfields Limited

European Goldfields Limited

January 10, 2005 08:30 ET

European Goldfields Awarded New Exploration Licence in Romania




JANUARY 10, 2005 - 08:30 ET

European Goldfields Awarded New Exploration Licence in

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 10, 2005) - European
Goldfields Limited (TSX VENTURE:EGU)(AIM:EGU) (the "Company") is pleased
to announce that its wholly-owned subsidiary European Goldfields Romania
SRL has been awarded by The National Agency for Mineral Resources in
Romania (NAMR) an exploration license for the Cainel perimeter located
in the historic gold producing area of the "Golden Quadrilateral" area
of Romania. The licence was awarded following a public tender in which
two other exploration companies participated.

The licence is for an initial term of three years, renewable for an
additional term of three years under certain conditions. The licence
covers an area of 31.3 km2 and lies only 10 km to the northwest of the
Company's 80%-owned Certej deposit and surrounding satellite bodies,
where the Company has undertaken an in-house resource development and
pre-feasibility programme, expected to be completed by the second
quarter of 2005.

To date, encouraging drilling results highlight grade continuity at
Certej and the potential to optimise and redesign an appropriate open
pit for exploiting the deposit. A previous resource estimate of the
Certej deposit undertaken by RSG Global of Perth, filed on SEDAR on 29
January 2004 under the category "Engineering Report", outlined an
indicated resource of 34.7Mt grading 2.1 g/t gold and 10 g/t silver for
2.5Moz Au Eq. This estimate was based on a selective mining unit model
utilising 10 x 10 x 10 metre blocks and a 1 g/t Au cut off.

Mineralisation in the Cainel perimeter occurs as brecciation, alteration
and veining associated with intermediate intrusive and extrusive Neogene
volcanics within Neogene sediments and occurs along the same northwest
trending structural belt as the Certej deposit. Historic workings
indicate that the mineralised systems occur over a strike length of some
1000 metres and over a discontinuous width of some 250 metres.

The Cainel perimeter has never been available to a commercial
exploration company. However, the area has been the subject of sporadic
small scale underground mining since 1844, though records show that this
only exploited at depth with the top 200 metres being preserved. Simple
gravity recovery methods utilised in the historic operations indicate
that the gold occurred freely and the ore is non-refractory.

Furthermore, exploration of known veining was conducted by the Romanian
State minerals company Minexfor between 1958 and 1977. Exploration
indicated that the average grade of the veins was between 3.4 and 3.9
g/t Au based on gravimetric assays only, further supporting the evidence
for free gold.

Neither the historic production nor the exploration tested the extensive
wall rock alteration and brecciation around the veining. However, recent
grab sampling at surface conducted by European Goldfields has indicated
the following grade ranges in mineralised areas:

- Altered andesite 0.1 to 39.7 g/t Au

- Veining 0.3 to 18.6 g/t Au

- Breccia 0.1 to 8 g/t Au

Areas of waste rock and tailings have also been identified on the
licence and the historic exploration programme by Minexfor indicated
that one waste dump had an average grade of between 0.8 and 0.9 g/t Au.
Grab sampling by European Goldfields indicates that waste material
grades between 0 and 152 g/t Au.

European Goldfields plans a programme of orientation work in early 2005
followed by a systematic evaluation of the Cainel perimeter using
diamond core drilling, channel sampling of accessible outcrop and
underground workings and by trenching.

Finally, the Company has decided to relinquish its 80%-owned
exploitation licence for the Zlatna perimeter in Romania where
exploration undertaken since 1999 had not yet demonstrated the economic
viability of the deposit. This will allow the Company to concentrate its
exploration and pre-feasibility activities to the more contiguous Certej
and Cainel perimeters.

David Reading, Chief Executive Officer of the Company, said:

"The new licence award consolidates the position of European Goldfields
as a prominent exploration company in Romania, one of the most prominent
gold provinces in Europe. We will benefit from the close proximity of
the Cainel licence to our existing Certej operations in further
developing an area of considerable opportunity."

"This award provides European Goldfields with a strong growth platform
in Romania, enhancing our ability to further extract value through our
comprehensive knowledge of the area as well as through our strong


The quantity and grade of the possible Cainel mineral deposit is
conceptual in nature, there has been insufficient exploration to define
a mineral resource on the property and it is uncertain if further
exploration will result in discovery of a mineral resource on the

Forward-Looking Statements

This news release contains certain forward-looking statements concerning
the Company's future operations, economic performances, financial
condition and financing plans. These statements are based on certain
assumptions and analyses made by the Company in light of its experience
and its perception of historical trends, current conditions and expected
future developments as well as other factors the Company believes are
appropriate in the circumstances. However, whether actual results and
developments will conform with the Company's expectations and
predictions is subject to a number of risks, uncertainties and
assumptions. Consequently, all of the forward-looking statements made in
this news release are qualified by these cautionary statements, and
there can be no assurance that the results or developments anticipated
by the Company will be realised or, even if substantially realised, that
they will have the expected consequences to or effects on the Company
and its subsidiaries or their businesses or operations. The Company
undertakes no obligation and does not intend to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required under applicable


Contact Information

    European Goldfields
    David Reading
    Chief Executive Officer
    +44 (0)20 7408 9536 or London Mobile: +44 (0)7703 190 652
    European Goldfields
    David Grannell
    Chief Financial Officer
    +44 (0)20 7408 9536 or London Mobile: +44 (0)7703 190 652
    Buchanan Communications
    Bobby Morse
    +44 (0)20 7466 5000
    Buchanan Communications
    Ben Willey
    +44 (0)20 7466 5000
    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release and the
    information contained herein.