European Minerals Corporation
TSX : EPM
AIM : EUM

European Minerals Corporation

June 13, 2007 09:30 ET

European Minerals Corporation: Varvarinskoye Update

Major Construction Milestones Achieved

LONDON, ENGLAND--(Marketwire - June 13, 2007) - European Minerals Corporation ("EMC" or the "Company")(TSX:EPM)(AIM:EUM) is pleased to report that its Varvarinskoye gold/copper project is continuing to develop at a rapid pace and remains on course for commissioning in October 2007. Highlights of recent construction progress include:

Process Plant
- All four grinding mills have been lifted onto their bearings.
- Assembly of the primary crusher completed.
- Construction and installation of all major tanks (leach, CIP, detox and water) and flotation cells and thickeners.
- All major concrete work completed.

Mining
- Over 300,000 tonnes of ore already stockpiled.
- Open pit development and overburden stripping progressing as planned.

General Site
- Work is continuing on installation of the various electrical systems, conveyors and general site infrastructure.

Bert Kennedy, EMC President and CEO, commented today:

"Activity at Varvarinskoye is now very intense. We currently have around 350 employees working on the process plant construction and mine development and in addition our Kazak sub-contractors also have some 200 employees on site. With the onset of spring - like weather we are now planning to work on a double shift basis to take advantage of the extended daylight hours. Shipment of equipment and material from suppliers continues and we expect this to be complete by the end of August 2007.

Despite the various delays arising in relation to certain equipment delivery and our well documented replacement of the project contractor last year, progress at the project has been excellent. We worked through some very severe winter weather and we are on schedule to complete construction in October 2007. Once again my thanks must go to all employees and contractors who are responsible for the achievements to date."

The Company regularly updates its website at www.europeanminerals.com with photographs illustrating the progress at site. We invite readers to visit the site to gain a visual impression of the project progress.

About Varvarinskoye.

Varvarinskoye is a gold-copper deposit located in Northern Kazakhstan. The 3 sq. km. licence contains significant gold and copper resources with major expansion potential. In a news release dated January 15, 2007, the Company announced independently prepared measured and indicated resource estimates of 3.916 million ounces of gold and 450 million pounds of copper. Based on these resources and using a gold price of US$ 525 per ounce and a copper price of US$ 1.30 per pound, the pit design contains estimated proven and probable reserves of 60.6 million tonnes containing 2.2 million ounces of gold and 254 million pounds of copper at a grade of 1.15 g/t gold including 17.1 million tonnes at a grade of 0.67% copper. Tables 1 and 2 in the appendix to this news release provide a more detailed analysis of the mineral resource and reserve estimates for Varvarinskoye.

Based on the current reserve base and plant capacity, life of mine annual production is estimated to average 120,000 ounces of gold and 13 million pounds of copper. However over the first three full years of mine life average annual production is estimated to be 149,000 ounces of gold and 26 million pounds of copper.

Additional information with respect to the Company's Varvarinskoye mine plan is set out in the Company's news release dated January 15, 2007, a copy of which can be obtained from SEDAR at www.sedar.com.

Management considers Varvarinskoye to be economically robust at the base case metal prices of US$525 per ounce of gold and US$1.30 per pound of copper. Gold and copper prices continue to be much higher than these levels.

The Company is continuing to optimise its mine plan as development of the initial open pit advances and confirms the integrity of the Varvarinskoye orebody. As mining proceeds the Company intends to continue to operate a rigorous stockpiling plan to generate improved economic returns should metal prices continue to be higher that those used in the current mine plan.

Qualified Persons

The "qualified person" (as such term is defined in National Instrument 43-101) who compiled and is responsible for the mineral resource estimates referred to in this news release is Stephen Hyland, who is a Principal Consultant of Ravensgate (which is part of Passeres Group Pty Ltd.). The "qualified person" (as such term is defined in National Instrument 43-101) who supervised the preparation of and is responsible for the mineral reserve estimates referred to in this news release is Stephen Craig, who is an employee of Orelogy Pty Limited. Bert Kennedy, the Company's President and Chief Executive Officer, is the "qualified person" (as such term is defined in National Instrument 43-101) responsible for the technical and scientific information in this news release, other than the mineral resource and mineral reserve estimates.

Forward-Looking Statements

This news release contains or refers to forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future are forward-looking statements. Such forward-looking statements include statements contained in this news release regarding targets, estimates and/or assumptions in respect of future annual production of gold and copper, commodity prices, mineral resources and reserves, timing of commencement of operations, potential mineralization and future exploration, development and operational plans and objectives (including delineating additional mineral resources). These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to: the grade and recovery of ore which is mined varying from estimates; capital and operating costs varying significantly from estimates; inflation; changes in exchange rates; fluctuations in commodity prices; delays in the development of, and the commencement of operations at, the Company's Varvarinskoye Project caused by unavailability of equipment, labour or supplies, climatic conditions, delays in the delivery and installation of plant and equipment or otherwise; termination or suspension of the Company's debt facility; uncertainty of the outcome of any litigation; inability to delineate additional mineral resources or reserves; and other factors. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

The mineral resource and mineral reserve figures referred to in this news release are estimates and no assurances can be given that the indicated levels of minerals will be produced. Such estimates are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time may significantly change when new information becomes available. While the Company believes that the resource and reserve estimates referred to in this news release are well established, by their nature resource and reserve estimates are imprecise and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. If such estimates are inaccurate or are reduced in the future, this could have a material adverse impact on the Company.

Inferred mineral resources are estimated on limited information not sufficient to verify geological and grade continuity or to allow technical and economic parameters to be applied. Inferred mineral resources are too speculative geologically to have economic considerations applied to them to enable them to be categorized as mineral reserves. There is no certainty that mineral resources can be upgraded to mineral reserves through continued exploration.

Appendix

The key assumptions, parameters and methods used in the preparation of the following mineral resource and mineral reserve estimates are detailed in the MDM Ferroman "Varvarinskoye Gold/Copper Project Bankable Feasibility Study" dated November 2004 (see the Company's news release dated November 10th, 2004). The effective date for the following mineral resource and mineral reserve estimates is December 15th, 2006.


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TABLE 1 VARVARINSKOYE PROJECT
MINERAL RESOURCE ESTIMATES
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MEASURED MINERAL RESOURCES
@ 0.01 gpt Gold Cut-off
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Ore K Gold % Oz Lbs
Type Tonnes gpt Copper Gold Copper
---------------------------------------------------------------------
HGCF 20,900 1.33 0.61 890,455 279,688,647
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HGCP 5,923 1.12 0.46 212,352 59,804,873
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LGCF 54,509 0.89 N/A 1,558,146 N/A
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LGCP 2,919 1.05 N/A 98,468 N/A
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TOTAL 84,252 1.02 0.57 2,759,420 339,493,520
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INDICATED MINERAL RESOURCES
@ 0.01 gpt Gold Cut-off
---------------------------------------------------------------------
Ore K Gold % Oz Lbs
Type Tonnes gpt Copper Gold Copper
---------------------------------------------------------------------
HGCF 10,474 1.06 0.42 355,305 96,057,671
HGCP 1,127 0.88 0.62 31,867 15,311,584
LGCF 26,387 0.88 N/A 743,256 N/A
LGCP 912 0.91 N/A 26,637 N/A
TOTAL 38,901 0.93 0.44 1,157,065 111,369,256
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MEASURED & INDICATED MINERAL RESOURCES
@ 0.01 gpt Gold Cut-off
---------------------------------------------------------------------
Ore K Gold % Oz Lbs
Type Tonnes gpt Copper Gold Copper
---------------------------------------------------------------------
HGCF 31,374 1.24 0.54 1,245,759 375,746,318
HGCP 7,050 1.08 0.48 244,218 75,116,458
LGCF 80,896 0.89 N/A 2,301,401 N/A
LGCP 3,832 1.02 N/A 125,106 N/A
TOTAL 123,153 0.99 0.53 3,916,485 450,862,776
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INFERRED MINERAL RESOURCES
@ 0.01 gpt Gold Cut-off
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Ore K Gold % Oz Lbs
Type Tonnes gpt Copper Gold Copper
---------------------------------------------------------------------
HGCF 4,788 0.92 0.41 141,191 43,704,841
HGCP 373 0.73 0.32 8,713 2,600,260
LGCF 11,123 1.09 N/A 390,549 N/A
LGCP 356 0.82 N/A 9,385 N/A
TOTAL 16,640 1.03 0.41 549,839 46,305,101
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Note:- HGCF is High Grade Copper Feed - flotation ore
HGCP is material stockpiled for treatment in the future
LGCF is Low Grade Copper Feed - Gold leach ore
LGCP is Low Grade Copper Feed - Gold leach ore from the weathering zone


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TABLE 2 VARVARINSKOYE PROJECT MINERAL RESERVE ESTIMATES
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Contained Metal
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Ore Gold Copper Gold Million lbs
K Tonnes gpt % K ozs Copper
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Category PROVEN MINERAL RESERVES
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HGCF 14,386 1.59 0.70 733 223
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LGCF 33,610 0.97 N/A 1,049 N/A
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LGCP 2,583 1.09 N/A 90 N/A
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TOTALS 50,579 1.15 0.70 1,872 223
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Category PROBABLE MINERAL RESERVES
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HGCF 2,719 1.43 0.52 125 31
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LGCF 6,640 1.04 N/A 222 N/A
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LGCP 699 0.95 N/A 21 N/A
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TOTALS 10,058 1.15 0.52 369 31
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Category PROVEN & PROBABLE MINERAL RESERVES
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HGCF 17,105 1.56 0.67 858 254
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LGCF 40,250 0.98 N/A 1,271 N/A
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LGCP 3,282 1.06 N/A 111 N/A
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TOTALS 60,637 1.15 0.67 2,241 254
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Note:- HGCF is High Grade Copper Feed - flotation ore
LGCF is Low Grade Copper Feed - Gold leach ore
LGCP is Low Grade Copper Feed - Gold leach ore from the weathering zone

Contact Information

  • Investor Information:
    Tony Williams
    United Kingdom
    Chairman
    Tel: +44 (0) 20 7529 7508
    or
    Bert Kennedy
    President & CEO
    Tel: +44 (0) 20 7529 7508
    or
    North America
    Keith Schaefer
    Vanguard Shareholder Solutions Inc.
    Tel: 1.866.448.0780
    ir@vanguardsolutions.ca