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European Goldfields reports resource increase for Greek projects, may move to LSE Main List from A


European Goldfields Ltd (LON:EGU, TSE:EGU) reported a net increase in the total measured and indicated mineral resources for its Greek projects - Skouries and Olympias – over the previously filed NI 43-101 report to 9.6 million ounces of gold and 1.2 million tonnes of copper.

This includes a newly declared inferred resource of 828,000 ounces of gold and 288,000 tonnes of copper at Skouries.

The group has updated the resource and reserve statement for the projects in the wake of ministerial approval of the environmental impact study (EIS) submitted by 95 percent owned subsidiary Hellas Gold SA.

The update reflects the current environment for costs and commodity prices, to account for the timing in the receipt of the permit and the implementation of the business development plan approved under the EIS.

The company's total measured and indicated resources inclusive of reserves have risen to 23.8 million gold equivalent ounces and attributable proven and probable reserves are up at 18.1 million gold equivalent ounces.

European Goldfields pointed out the importance of the ministerial approval of Hellas’s EIS, saying this will allow it to progress towards its goal of becoming the largest primary gold producer in Europe and will provide the Greek economy with much needed and significant investment.

It has appointed Goldman Sachs International to assist in the evaluation of a potential move from AIM to the Main Market of the London Stock Exchange, with Lazard & Co also provide financial advice in connection with this.

The group has has reconfirmed its business development plan for Olympias. It plans to retreat the tailings and refurbish the concentrator, enabling first gold production during the second quarter of 2012. The underground mine will be then refurbished to allow a primary run rate of 400,000t per annum by Q4 2015 through the existing concentrator.

It will then expand the underground mine to a run rate of 850,000t per annum and establish a new Stratoni Concentrator by 2020.

Olympias’ mine life was extended by 25 percent as a result of additional reserves.

The business development plan for Skouries envisages open pit and infrastructure development towards first gold production from Skouries during Q1 2014. Underground development will follow the open pit and is currently expected to start in 2020.

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