Eldorado Gold Corporation

Eldorado Gold Corporation

July 04, 2005 09:11 ET

Update on Eldorado / AFCAN Transaction

TORONTO, ONTARIO and VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - July 4, 2005) - AFCAN Mining Corporation (TSX:AFK) ("Afcan, the "Company" or "we") and Eldorado Gold Corporation (TSX:ELD)(AMEX:EGO) ("Eldorado") by mutual agreement have extended the period of due diligence from June 29 to July 8, 2005. The extension will enable both parties to complete final documentation of the Transaction that was announced on May 30, 2005 whereby Eldorado will acquire all of the issued and outstanding shares of Afcan. Afcan is an emerging gold producer that owns an 85% interest in Tanjianshan Gold Project in Qinghai Province in Western China. The transaction will combine Afcan's high quality Tanjianshan development and exploration project with Eldorado's development, operations and financial strength to create one of the leading gold producers in China.

The President and CEO of Afcan, David G. Netherway stated, "Construction at the TJS site is proceeding on target with procurement of the major equipment items about to commence."

AFCAN is an emerging gold producer in China and owns 85% of the TJS Project at Tanjianshan in Qinghai Province. Afcan has agreed an offer from Eldorado Gold Corporation (TSX: ELD, AMEX: EGO) whereby Afcan will become a wholly owned subsidiary of Eldorado. A Bankable Feasibility Study has been completed on the Project and construction has commenced. There are 23 additional anomalies on the 341 km2 licence currently under investigation. Afcan is focused on further growth through the exploration and development of this advanced project.


David G Netherway

President and Chief Executive Officer

Certain of the statements made in this release are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, which involve known and unknown risk, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements in this release include statements regarding the anticipated benefits of the proposed business combination, estimates relating to mineral reserves, future gold production and mine life, and other statements regarding future events on the Company's or Afcan's properties, or otherwise relating to the Company or Afcan. Forward-looking statements are subject to a variety of risks and uncertainties including but not limited to gold price volatility; impact of any hedging activities, including margin limits and margin calls; discrepancies between actual and estimated production, between actual and estimated reserves, and between actual and estimated metallurgical recoveries; mining operational risk; regulatory restrictions, including environmental regulatory restrictions and liability; risks of sovereign investment; speculative nature of gold exploration; dilution; competition; loss of key employees; additional funding requirements; and defective title to mineral claims or property, as well as those factors discussed in the section entitled "Business - Risk Factors" in the Company's Annual Information Form, Form 40F dated March 30 ,2005 for the fiscal year ended December 31, 2005. We do not expect to update forward-looking statements continually as conditions change and you are referred to the full discussion of the Company's business contained in the Company's reports filed with the securities regulatory authorities in Canada and the U.S.

The securities described herein have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements.

Note to U.S. Investors. While the terms "mineral resource", "measured mineral resource," "indicated mineral resource", and "inferred mineral resource" are recognized and required by Canadian regulations, they are not defined terms under standards in the United States and normally are not permitted to be used in reports and registration statements filed with the SEC. As such, information contained in this report concerning descriptions of mineralization and resources under Canadian standards may not be comparable to similar information made public by U.S companies in SEC filings. With respect to "indicated mineral resource" and "inferred mineral resource" there is a great amount of uncertainty as to their existence and a great uncertainty as to their economic and legal feasibility. It can not be assumed that all or any part of an "indicated mineral resource" or "inferred mineral resource" will ever be upgraded to a higher category. Investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.

Afcan Mining Corporation's shares trade on the Toronto Stock Exchange (TSX:AFK).

Eldorado Gold Corporation's shares trade on the Toronto Stock Exchange (TSX: ELD) and the American Stock Exchange (AMEX: EGO).

The TSX has neither approved nor disapproved the form or content of this release.

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